MBC Group IPO: Saudi media giant plans to list on Tadawul

Saudi-headquartered MBC Group announced its intention to proceed with an initial public offering (IPO) and the listing of its ordinary shares on the Saudi Exchange (Tadawul).

One of the region’s top media and entertainment companies, MBC Group’s main business segments include TV broadcasting, Shahid, the over-the-top video streaming platform, MBC Studios and various media-related ventures.

MBC’s content reaches more than 150 million people across the region every week.

MBC Group receives CMA approval

On Tuesday, November 21, the kingdom’s Capital Market Authority (CMA) approved the company’s application for registering its share capital and offering of 33,250,000 (33.25 million) ordinary shares through a capital increase, representing 10 per cent of the company’s share capital (following the issuance of the offer shares and increase of the company’s share capital).

The offer price will be determined at the end of the book-building period.

The shares will be offered for subscription to individual and institutional investors, including institutional investors outside the US in accordance with Regulation S under the US Securities Act of 1933G, as amended.

The offering’s net proceeds will be utilised for repayment of outstanding debt, enhancing liquidity headroom to finance the working capital requirements of the business, Shahid (its OTT streaming platform) content expenditure, and investment in new initiatives, the company said in a statement.

MBC IPO will drive next ‘phase of growth’

Waleed bin Ibrahim Al Ibrahim, chairman, of MBC GROUP, said, “Today, MBC Group is proud to be one of the MENA region’s leading media and entertainment companies. With over 30 years of continuous growth owed to our significant investment in media, quality content generation and entertainment, we are prepared for our next phase of growth.

“Through the IPO, we aim to further grow our market position and audience reach, continue investing in our popular streaming platform, Shahid, and expand into promising entertainment verticals. While our heart remains entrenched in Arab culture, this is in line with our ambitions to continue evolving as a global media and entertainment powerhouse, while further deepening our commitment to realizing Vision 2030 by supporting the growth and development of the media and entertainment sector.

“Through this offering, we are inviting investors to be part of a robust enterprise, a well-reputed brand, underpinned by strong macro fundamentals and dynamic growth prospects. Our Board of Directors and the leadership team look forward to the opportunities ahead of us. With our sights set firmly on the future, our commitment remains to exceed shareholders’ expectations by delivering attractive returns.”

Sam Barnett, CEO of MBC Group, added, “This IPO is a testament to our ambition to create a leading media group that enriches lives through content, interaction, and entertainment.  Over the decades, we have built a diverse platform portfolio that has accumulated a high audience share and generated an expansive reach.

“Captivating content, cutting-edge technologies, and robust data are core to our business and combine to ensure a fantastic service for our viewership of 150 million viewers per week.  Looking forward, we anticipate expansion through content diversification, new subscription models, targeted advertising, and expanded geographic presence. We are also excited by the growth in new areas such as gaming and events.”

Commenting on the IPO, Arun Leslie John, chief market analyst of Dubai-based investment firm Century Financial, said: “MBC reported revenues of $930m for last year, posting a stellar 23 per cent CAGR over the last three years. One important point to note is that the group has maintained its consistent Saudi market share of 40 per cent for the last 10 years. With the approval valid for six months, the IPO is expected to be completed by May or June of next year.

“The IPO timing is in line with the IPO boom witnessed in the GCC countries. It should be noted that there are no major details available as of now on the valuations.”

In other news, EY shared that the kingdom dominated MENA IPO activity in terms of the number of listings, with four listings on Tadawul main market raising $0.8bn. Similarly, seven IPOs on Tadawul’s Nomu parallel market raise $0.1bn in proceeds. Jamjoom Pharmaceuticals Factory Company raised $336m, the highest raise on the Tadawul for the quarter, followed by First Milling Company which raised $266.4m.

Read: MENA stock markets maintain IPO momentum, raises $1.8bn in Q2 2023