Five Saudi stocks to be closed to foreign investors

Tuesday, Jun 02, 2015

Dubai: Foreigners will not be allowed to hold investments in five listed companies in Saudi Arabia when it opens for trading on June 15.

According to a statement on bourse’s website, the stocks are Jabal Omar Development, Taiba Holding Co, Knowledge Economic City, National Shipping Co of Saudi Arabia (Bahri), and Makkah Construction & Development Co.

There are about 170 companies listed on the exchange.

The CMA, which will open the market to foreigners on June 15, has said foreign ownership of individual listed firms may be restricted by the companies’ by-laws or by instructions from supervisory authorities.

Jabal Omar, Makkah Construction and Taiba focus on the holy cities of Mecca and Medina.

Maximum holding:

Meanwhile, according to the rules, each approved QFI client together with its affiliates may own a maximum of 5 per cent of the shares of any issuer whose shares are listed and the QFI must not execute any transaction which would result in the relevant client, together with its affiliates, owning more than 5 per cent of the shares of any issuer whose shares are listed. The maximum allowed is 49 per cent including interests under swaps.

The maximum proportion of the shares of any issuer whose shares are listed that may be owned by QFIs and approved QFI clients is 20 per cent, according to the Capital Market Authority. In addition, the maximum proportion of the shares of all issuers whose shares are listed that may be owned by QFIs and approved QFI clients in aggregate is 10 per cent by market value, including any interests under swaps.

Staff Report