By A E James
Muscat: Oman Qatar Insurance Company (OQIC) plans to float its OMR4 million Initial Public Offering (IPO) on September 6, close on the heels of two other companies raising funds from the investing public on the Muscat Securities Market (MSM) in August.
The company received an approval for its prospectus from the Capital Market Authority (CMA) on Tuesday for offering 25 million shares, which is equivalent to 25 per cent of its paid up capital. The issue, which will be offered at 160 baisas per share, will open for subscription for a month between September 6 and October 5, according to reliable sources at the company and issue manager. The issue manager for Oman Qatar’s share offer is Ubhar Capital (U Capital). As per the tentative plan, the share allotment will be on October 16 and the shares will be listed on October 19 on the Muscat bourse.
Mohammed Al Abri, director general of Issues and Disclosures at CMA, said the issue prospectus of other two national insurance firms—National Life and General Insurance and Arabia Falcon—will also get CMA approval soon.
Oman Qatar Insurance Company is a subsidiary of the Qatar Insurance Company (QIC), a publicly listed composite insurer with a consistent performance history of five decades and an underwriting footprint across the Middle East, Africa and Asia. QIC is one of the highest rated insurers in the Gulf region with a rating of A/Stable from Standard & Poor’s and A (Excellent) from A.M. Best. In terms of profitability and market capitalisation, QIC is also the largest insurance company in the Middle East and North Africa (Mena) region.
At the same time, OQIC’s local shareholder, Al Hosn Investment, a leading business house in the Sultanate has rendered continuous support and guidance.
All national insurance companies, in line with a CMA regulation, are offering 25 per cent of their paid-up capital to the investing public.
Although the Sultanate has 22 insurance companies (11 locally incorporated and 11 branch operations of foreign firms), only six companies—Dhofar Insurance, Oman United Insurance, Al Ahlia Insurance, Vision Insurance, Al Madina Takaful and Takaful Oman—are listed. Of these, Al Madina Takaful and Takaful Oman are Islamic insurance firms.
The new listings will mark a new chapter in the Omani insurance sector, as local companies will be able to withstand competition by strengthening their financial, technical and human resources. A higher capital base will result in these institutions being large enough to underwrite more risks and retaining premiums within the country.
In 2014, the Omani government had asked national insurance firms to float shares on MSM within three years, along with raising their minimum capital to OMR10 million from OMR5 million. Also, insurance firms must comply with all listing requirements, and promoters will have to divest a minimum of 25 per cent in favour of investors.