Saudi First Mills’ $266.4m IPO attracts bids worth $18bn

Saudi Arabia’s First Milling Company (First Mills) has raised $266m (SAR999m) in its initial public offering (IPO), which attracted bids worth SAR68.8bn from investors amid a boom in the kingdom’s share offerings.

First Mills said big investors placed orders worth SAR68.8bn, almost 69 times more than was available to them. At an indicative price of SAR60 apiece, the public offering will raise SAR999m and values the company at SAR3.33bn

“The impressive demand by participating parties for First Mills’ offer shares is a resounding validation of the company’s investment thesis. They appreciate the company’s long-term value creation potential supported by its market leadership, diverse product portfolio, outstanding financial performance, and effective leadership team,” said Abdullah Ababtain, CEO of First Milling Company.

#FirstMills has set its final IPO Offer Price at (60 SAR) per share, and the individual investor subscription period will be from 6-7 June inclusively.

To find out more, please visit: https://t.co/S2a5F0pAlj?#FirstMillsIPO

— المطاحن الأولى – First Mills (@FirstMills_sa) May 30, 2023

The milling company said it will start taking orders from retail investors from June 6 to June 7. Once listed, First Mills is expected to have a free float of 30 per cent of the entire issued share capital of the company.

First Mills joins Saudi booming IPO market

Meanwhile, First Mills’ IPO is set to be the second biggest in Saudi Arabia this year, after drugmaker Jamjoom Pharmaceuticals Factory’s $336m offering earlier in May.

Jamjoom Pharma’s listing also priced at the top of the range last week and got institutional investor orders for 67 times the shares on offer.

Similarly, Morabaha Marina Financing Company started taking investor orders for its IPO on the Saudi Exchange in May as the financing firm aims to raise as much as SAR312.9m.

The company intends to use the net proceeds to strengthen its capital base to support future growth in its business activities by generating additional capacity to provide financing to customers.

Founded in 2012, the independent non-bank finance institution offers Shariah-compliant financial services to individuals and small and medium-sized enterprises in Saudi Arabia.

Saudi Arabia’s IPO market has returned to life after a slowest start since 2014 amid concerns over falling oil prices and a global economic slowdown. The Middle East IPO market has stood out as a bright spot globally despite the reported postponement of the listing of Aramco’s energy-trading business, and oil and gas driller ADES International Holding – which the Public Investment Fund backs.

EY projected that the IPO outlook in the MENA region for the rest of 2023 remains positive, with several Saudi Arabia companies expected to list on Tadawul including Ghida Al-Sultan Company, Foods Gate, Meyar Construction Company, Saudi Lime Industries Company and HyperPay.

Read: Saudi Arabia’s Morabaha Financing set to raise $83.4m in IPO