Image credit: OQ
Oman’s OQ has started taking investor orders for the initial public offering (IPO) of its methanol and liquefied petroleum gas unit, and the state energy firm seeks to raise as much as $490m (OMR 188.2m), capitalising on the robust appetite for listings in the GCC region.
OQ is offering 1.69 billion shares, equivalent to 49 per cent of OQ Base Industries’ (OQBI) total issued share capital, at $0.28 (Bzs106) to Bzs111 per share. At the top end of that price range, OQ Base Industries would be valued at OMR385m.
“This IPO, along with those prior, are not only great points of pride to the Group, but they are also a clear reflection of our mission to fuel Oman’s development, in alignment with Vision 2040, to make a lasting impact on the domestic and global energy and industrial landscape,” said Ashraf Hamed Al Mamari, group CEO of OQ.
With the listing of its methanol and ammonia business, OQ has completed the divestment of four subsidiaries over the past two years via listings on the Muscat Stock Exchange (MSX).
Falcon Investments, Gulf Investment Corporation, Saudi Omani Investment Company and Social Protection Fund have committed to subscribe for shares worth as much as OMR56m as anchor investors.
The company is offering the shares in two tranches – to institutional investors and retail investors – between November 24 and December 1, with trading debut on MSX scheduled for December 15.
To attract investors, OQBI plans to pay about $85m in dividends for 2024. For 2025 and 2026, the payout will be at least 5 per cent higher than the previous year.
Salalah-based OQBI has a combined production capacity of 1.8 million metric tons per annum (mtpa), with methanol accounting for around 1.1 mtpa of the total.
The firm reported revenue of $510m and an adjusted EBITDA margin of 43.1 per cent for the year ended December 2023. It expects to pay a dividend of about $63.6m (OMR24.5m) for the first nine months of 2024 by January and a second tranche of about OMR8.2m by April.
OQ appointed Bank Dhofar, Bank Muscat and Morgan Stanley & Co as joint global coordinators and bookrunners for the IPO.
The listing of OQ’s unit joins a wave of private company listings in the Middle East this year, with IT services firm Alpha Data considering listing in Abu Dhabi.
PwC said the outlook for the GCC IPO market remains buoyant, with a healthy IPO pipeline of companies from a diverse range of sectors busy preparing for their upcoming listings across the region.
The listing activity is expected to continue in the final quarter with a wave of private company listings in the pipeline, including IT services firm Alpha Data, Bahrain’s AlAbraaj Restaurants Group, and Nice One and Almoosa in Saudi Arabia.
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