Saudi investors showed their desire to back fundraising IPOs – rather than just sales of existing shares – with an enormous book for the listing of Umm Al Qura for Development and Construction.

Umm Al Qura priced its Tadawul IPO at the top of a narrow SR14–SR15 range after the deal was 241 times subscribed.

The 130.8m primary share offer, for a 9.1% free-float, gives a deal size of SR1.96bn (US$523m) that values the company at SR21.58bn.

A retail offer for up to 10% of the shares will follow from March 5–9. Final allocations will be confirmed on March 13.

The capital raise will support the group’s Masar Destination project in Mecca, which will see the redevelopment of an area stretching more than 3.5km with a mixture of tourist and residential accommodation as well as retail outlets and public amenities.

The project is closely tied to Saudi Arabia’s Vision 2030 programme of economic diversification and aims to capitalise on rapidly growing tourist and pilgrim demand in Mecca.

Albilad Capital is lead manager, and joint bookrunner with Alinma Investment Company, Al Rajhi Capital and GIB Capital. Lazard is advising.

Source: IFR