07 August 2007
MUSCAT -- The IPO fever is back as the much-publicised initial public offering of engineering and contracting major, Galfar Engineering & Contracting, is set to hit the market.
The IPO mania has been gripping investors since the company announced its plans to go public sometime ago. Galfar will enter the capital market on Sunday with its initial public offering of 100 million ordinary shares at a price of RO0.602 per share comprising nominal value of RO0.100, premium of RO0.500 and issue expenses of RO0.002 per share, aggregating to RO60.2 million.
"It's a good IPO. Investors, flushed with IPO fever, are expected to form long queues at bank branches from Monday to subscribe for Galfar shares," a high networth individual investor opined.
The objectives of the issue include raising capital to fund the company's capital investment programme, and meeting long-term working capital requirements and listing the company's shares on the Muscat Securities Market (MSM). Of the aggregate proceeds from the offering RO36 million in consideration for 60 million shares will be distributed to the selling shareholders through this offering, which is at an offer price of RO0.600 per share. The company will receive the proceeds amounting to RO24 million relating to issue of new shares, which will be utilised for the purpose of financing its ongoing capital expenditure and additional working capital requirements.
Galfar was registered in 1975 and subsequently was incorporated in 1986 as a limited liability company. Galfar is currently undergoing the due process of transformation into an SAOG company organised under the laws of the Sultanate of Oman. The company, which is registered with the OCCI as an excellent grade contractor holds the following material permits and licences.
The company is also registered with the Tender Board and Ministry of Defence as an excellent grade contractor. The company is also approved by the PDO as a service vendor for various categories of services and by the Oman Refinery Company as an approved vendor. Galfar is a member of the Oman Society for Petroleum Services who has certified the company for health, safety and environment management and for minimum employment standards. The company holds ISO 9001: 2000 certification for project management, design & engineering, procurement, fabrication, construction, and installation relating to oil and gas sector, roads and highways, process plants, pipelines, etc. It holds ISO 14001: 2004 for environment management system and OHSAS 18001: 1999 for occupational health safety and assessment.
The authorised share capital of the company will be RO50 million divided into 500 million shares with a face value of 100 baisas each consisting of two classes of shares such as ordinary shares (350 million shares representing 70 per cent of the authorised capital and preferential voting rights shares (150 million shares representing 30 per cent of the authorised capital). Issued and paid-up share capital of the company will be RO25 million, divided into 250 million shares with a face value of (post-IPO) RO0.100 each consisting of two classes of shares such as ordinary shares (175 million shares representing 70 per cent of the issued and paid-up capital) and preferential voting rights shares (75 million shares representing 30 per cent of the issued and paid-up capital). The current capital of the company RO21 million divided into 210 million.
The subscription will be open to Omani and non-Omani individuals, corporates, institutions, investment funds, and pension funds. Non-Omani individuals/corporates can own shares of the company once listed with Muscat Securities Market, to an extent of 70 per cent of the share capital. The number of shares subscribed by each person shall not be less than 1,000 shares and in multiples of 100 thereafter. For juristic persons, corporates, investment funds, and pension funds, shares subscribed to shall not be less than 10,100 shares and in multiples of 100 thereafter.
The company spent an amount of RO43.5 million in 2006 on capital assets for enhancing its project execution capability, and achieving a substantial growth in revenue. Corresponding to its future growth plans, the company has estimated capital expenditure towards plant and machinery and motor vehicles of RO12 million, RO11 million and RO10 million in 2007, 2008 and 2009, respectively.
The share capital of the company will increase from RO20 million in 2006 to RO25 million in the year 2007 through an issue of additional shares of RO1 million at par prior to the proposed IPO and the issue of new shares at amounting to RO4 million (nominal value) through the IPO. As a result of the IPO the company will generate additional funds amounting to RO20 million as share premium. The share capital is assumed to remain unchanged in 2008 and 2009.
Galfar has an order book of RO450 million, bulk of which is spread across 20 major projects in Oman. The offer price of RO0.600 per share compares favourably with the prevailing aggregate P/E multiples of the MSM. Galfar is a diversified multi-disciplinary engineering and construction company.
The offer price of Galfar's shares results in a lower P/E multiple as compared to the average P/E multiple of its peer group companies.
In case of over-subscription the offering of 100 million ordinary shares shall be split among the eligible investor groups, in the following portions: (a) Sixty million ordinary shares, being 60 per cent of the offering, for individual applicants applying for a maximum of 10,000 shares. Distribution of shares shall be on pro-rata basis. Forty million ordinary shares, being 40 per cent of the offering, for individual applicants applying for more than 10,000 shares and for corporate bodies/ institutions/ investment funds.
Distribution of shares shall be on pro-rata basis. Allotment for non-Omani will be limited to a maximum of 40 per cent of the total shares offered. Oman Arab Bank Investment Management Group is the issue manager. The issue closes on September 10.
MUSCAT -- The IPO fever is back as the much-publicised initial public offering of engineering and contracting major, Galfar Engineering & Contracting, is set to hit the market.
The IPO mania has been gripping investors since the company announced its plans to go public sometime ago. Galfar will enter the capital market on Sunday with its initial public offering of 100 million ordinary shares at a price of RO0.602 per share comprising nominal value of RO0.100, premium of RO0.500 and issue expenses of RO0.002 per share, aggregating to RO60.2 million.
"It's a good IPO. Investors, flushed with IPO fever, are expected to form long queues at bank branches from Monday to subscribe for Galfar shares," a high networth individual investor opined.
The objectives of the issue include raising capital to fund the company's capital investment programme, and meeting long-term working capital requirements and listing the company's shares on the Muscat Securities Market (MSM). Of the aggregate proceeds from the offering RO36 million in consideration for 60 million shares will be distributed to the selling shareholders through this offering, which is at an offer price of RO0.600 per share. The company will receive the proceeds amounting to RO24 million relating to issue of new shares, which will be utilised for the purpose of financing its ongoing capital expenditure and additional working capital requirements.
Galfar was registered in 1975 and subsequently was incorporated in 1986 as a limited liability company. Galfar is currently undergoing the due process of transformation into an SAOG company organised under the laws of the Sultanate of Oman. The company, which is registered with the OCCI as an excellent grade contractor holds the following material permits and licences.
The company is also registered with the Tender Board and Ministry of Defence as an excellent grade contractor. The company is also approved by the PDO as a service vendor for various categories of services and by the Oman Refinery Company as an approved vendor. Galfar is a member of the Oman Society for Petroleum Services who has certified the company for health, safety and environment management and for minimum employment standards. The company holds ISO 9001: 2000 certification for project management, design & engineering, procurement, fabrication, construction, and installation relating to oil and gas sector, roads and highways, process plants, pipelines, etc. It holds ISO 14001: 2004 for environment management system and OHSAS 18001: 1999 for occupational health safety and assessment.
The authorised share capital of the company will be RO50 million divided into 500 million shares with a face value of 100 baisas each consisting of two classes of shares such as ordinary shares (350 million shares representing 70 per cent of the authorised capital and preferential voting rights shares (150 million shares representing 30 per cent of the authorised capital). Issued and paid-up share capital of the company will be RO25 million, divided into 250 million shares with a face value of (post-IPO) RO0.100 each consisting of two classes of shares such as ordinary shares (175 million shares representing 70 per cent of the issued and paid-up capital) and preferential voting rights shares (75 million shares representing 30 per cent of the issued and paid-up capital). The current capital of the company RO21 million divided into 210 million.
The subscription will be open to Omani and non-Omani individuals, corporates, institutions, investment funds, and pension funds. Non-Omani individuals/corporates can own shares of the company once listed with Muscat Securities Market, to an extent of 70 per cent of the share capital. The number of shares subscribed by each person shall not be less than 1,000 shares and in multiples of 100 thereafter. For juristic persons, corporates, investment funds, and pension funds, shares subscribed to shall not be less than 10,100 shares and in multiples of 100 thereafter.
The company spent an amount of RO43.5 million in 2006 on capital assets for enhancing its project execution capability, and achieving a substantial growth in revenue. Corresponding to its future growth plans, the company has estimated capital expenditure towards plant and machinery and motor vehicles of RO12 million, RO11 million and RO10 million in 2007, 2008 and 2009, respectively.
The share capital of the company will increase from RO20 million in 2006 to RO25 million in the year 2007 through an issue of additional shares of RO1 million at par prior to the proposed IPO and the issue of new shares at amounting to RO4 million (nominal value) through the IPO. As a result of the IPO the company will generate additional funds amounting to RO20 million as share premium. The share capital is assumed to remain unchanged in 2008 and 2009.
Galfar has an order book of RO450 million, bulk of which is spread across 20 major projects in Oman. The offer price of RO0.600 per share compares favourably with the prevailing aggregate P/E multiples of the MSM. Galfar is a diversified multi-disciplinary engineering and construction company.
The offer price of Galfar's shares results in a lower P/E multiple as compared to the average P/E multiple of its peer group companies.
In case of over-subscription the offering of 100 million ordinary shares shall be split among the eligible investor groups, in the following portions: (a) Sixty million ordinary shares, being 60 per cent of the offering, for individual applicants applying for a maximum of 10,000 shares. Distribution of shares shall be on pro-rata basis. Forty million ordinary shares, being 40 per cent of the offering, for individual applicants applying for more than 10,000 shares and for corporate bodies/ institutions/ investment funds.
Distribution of shares shall be on pro-rata basis. Allotment for non-Omani will be limited to a maximum of 40 per cent of the total shares offered. Oman Arab Bank Investment Management Group is the issue manager. The issue closes on September 10.
© Times of Oman 2007
