Saudi Arabia’s largest pharmacy chain operator Nahdi Medical Company, which has announced plans to launch an initial public offering (IPO), is also looking to expand its footprint in the UAE. 

The company, which is 50 percent owned by SEDCO Holding, one of the kingdom’s largest institutional investors, confirmed on Sunday that it is proceeding with the IPO and list its shares on the Saudi Stock Exchange (Tadawul).  

The offering will comprise a sale of 39 million ordinary shares, representing 30 percent of the company’s share capital, at a price to be determined at the end of a book-building period. 

Nahdi Medical operates 1,151 pharmacies in Saudi Arabia and holds a 31 percent market share of total pharmacy revenue in the kingdom. In 2019, the company expanded its GCC footprint with the opening of one outlet in Dubai. 

Expansion plans 

In its latest statement, Nahdi said that part of its strategy is to “accelerate expansion in the UAE”, which is considered one of the growing markets in the Gulf Cooperation Council (GCC) region, with online pharmacy sales forecast to post a 5.8 percent CAGR growth rate between 2020 and 2026. 

The company, which also operates express clinics, as well as an online platform with more than two million users and approximately 200,000 deliveries per month, is optimistic about the wider GCC region, which it said has “strong demographic tailwinds,” including high population growth, disposable income, and healthcare expenditures. 

The company’s plans include driving its omnichannel and e-commerce offerings via “click and collect”, delivery and guest care services. It is looking to add 43 more express clinics and two pilot lab satellites in the current quarter. 

Tadawul had approved the company’s application to list its shares on the main market last December 19. The Capital Market Authority later approved the IPO application on December 29. 

The company has appointed HSBC Saudi Arabia and SNB Capital as joint financial advisors, bookrunners and underwriters for its share offering. 

(Reporting by Cleofe Maceda; editing by Mily Chakrabarty) 

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