Nayifat Finance Company announces its intention to list on the Saudi Exchange

Offering overview

• Nayifat Finance Company (NFC) will offer 35 million shares (Offer Shares), representing 35% of the Company’s issued share capital of 100 million shares by way of a secondary offering (pro-rata sell down by shareholders)
• The Company’s Shares will be listed on the Saudi Exchange main market following the completion of the offering and listing formalities with both the Capital Market Authority (the “CMA”) and the Saudi Exchange
• The Offer Shares will be offered for subscription to retail and institutional investors, including institutional investors outside the United States in accordance with Regulations S (RegS) under the US Securities Act of 1933, as amended
• All the Offer Shares will be offered to institutional investors, with a clawback by the retail investors of up to 10%, as determined by the Bookrunners 

Company overview

• Over the past 19 years, NFC has cemented its position as a pioneer and one of the leading players in the consumer finance segment within the Non-Banking Financial Institutions (NBFI) sector through building a brand centred around customer care and satisfaction, in addition to gathering unparalleled market know-how supported by resilient operational capabilities and experienced management team.
• The Company offers customers 100% Sharia compliant products and services including consumer finance, credit cards, SME financing and fintech lending
• Strong revenue generation and robust risk management has resulted in steady and high net income levels since 2018 with a CAGR of around 10% and Return on Equity (RoE) of around 20%
• The Company has a strong dividend track record with a payout ratio of around 45% of net income over the last three years. NFC has paid 65% of the profit for Q4 2020 and Q1 2021 as dividend in Q2 2021
• NFC is well-positioned to capitalize on growth opportunities, driven by an agile growth strategy focused on innovative product offerings and expansion into new segments – Small and medium-sized enterprises (SME), Credit Cards and Fintech 

Riyadh: Nayifat Finance Company (“Nayifat” or “NFC” or the “Company”), one of the leading NBFIs focusing on consumer financing in Saudi Arabia, today announces its intention to proceed with an initial public offering (“IPO” or the “Offering”) and listing of its ordinary shares (“Shares”) on the Saudi Exchange main market. On 29 September 2021, the CMA approved the Company’s application for the initial public offering of 35,000,000 Shares (“Offer Shares”), representing 35% of NFC’s issued share capital, by way of sale of existing Shares by the shareholders of NFC (“Selling Shareholders”). The final offer price of the Offer Shares will be determined at the end of the book-building period.

The potential IPO will give NFC the opportunity to promote greater levels of internal efficiencies, corporate governance and transparency, allowing the Company to capitalize on its core consumer finance business while growing its portfolio of innovative financing solutions such as credit cards, SME lending and its newly introduced FinTech crowd funding platform (ULend) to existing customer base as well as new customers. Furthermore, the management believes that a potential listing will enable better access to capital markets, leverage exposure and public status to strengthen its profile and branding, allow the public the opportunity to participate and benefit from the business growth and increase transparency in the business beyond statutory financial reporting.

Saud Al Dosari, Chairman of NFC, said: “NFC is a pioneer in the NBFI space and has been a leading player in the industry for over 19 years. We believe now is the right time to go public. The listing enables us to move into the next stage of our ambitious strategy. The Kingdom’s Vision 2030 has presented many opportunities, including a successful transformation of Saudi’s capital markets which created an investment environment that is at par with developed countries. I’m confident NFC is well positioned to benefit from this change and be able to support the financing needs of the Saudi public.”

Abdulmohsen Al Sowailem, Managing Director and Chief Executive Officer of NFC, said: “Our agile business model and customer-centric approach allowed us to expand exponentially since 2002 as one of Saudi Arabia’s premier non-bank lenders. I am proud of our consistent, solid track record and unparalleled profitability. We will continue to focus on our core business while pursuing growth opportunities in the private and public sector. This IPO is the next stage of our development story, as it would further promote the NFC brand and support our expansion into FinTech, SME lending and credit card businesses.”

NFC has a comprehensive portfolio of more than 44K customers as of Q1 2021. It is the first licensed NBFI to issue VISA credit cards, which was launched in 2020, and offers customers 100% Sharia compliant products and services including consumer finance, credit cards, SME financing and FinTech lending.

© Press Release 2021