Apr 19 2012 |
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OAB partners to offload 290m shares via IPO
By A. E. James Muscat: The two stakeholders of Oman Arab Bank ( OAB ) have decided to divest 25 per cent stake in the bank in favour of investing public through an initial public offering (IPO).Of the two partners, Oman International Development and Investment Company ( Ominvest ) will dilute 21 per cent or 243.6 million shares and Bahrain-based Arab Bank 4 per cent or 46.4 million shares. The nominal value of the share is 100 basias each. However, it appears that the shares will be offered at a premium.
Presently, Ominvest has 51 per cent stake in the Omani bank, while the remaining 49 per cent holding is with Arab Bank .
The decision to change the status of the bank to a listed company was made by the bank's shareholders' meeting on March 31.
Ominvest shares soar
Ominvest shares soared 5.29 per cent to close at 398 baisas, amid demand for 2.35 million shares on the Muscat Securities Market (MSM) yesterday. The shares touched as high as 404 baisas and Ominvest stood third in terms of traded volumes on the MSM.
National Securities was appointed as the issue manager while Gulf International Bank is the financial valuation advisor. The legal advisor is Al Busaidy, Mansoor Jamal & Co. OAB will be the first Omani firm to dilute less than the minimum stipulated 40 per cent stake for listing shares on the local bourse.
The cabinet has approved Oman Arab Bank partners to offer 25 per cent stake and the bank's move is considered as a special case, since as per the existing law, a company can not go public unless the promoters dilute 40 per cent through an IPO. However, the government is now considering to bring down the minimum stipulated capital dilution (for companies floating initial public offering) to 25 per cent from 40 per cent now, in a move to encourage family-owned business to list their companies.
OAB -- the only non-listed bank in Oman -- has a net worth of RO147 million and a branch network of 64 branches. OAB , which celebrated its silver jubilee two years ago, has raised its capital base in the recent past by issuing a mix of rights issues and stock dividends. The enhanced capital will help the bank to get more facilities from other banks.
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