British pharmaceutical firm eyes dual listing on London, Tadawul

Cambridge-headquartered Atlantic Healthcare is a specialist pharmaceutical company that is working on developing drugs to treat inflammatory bowel disease and other rare gastrointestinal disorders. It currently has six promising clinical programs underway at various stages.

The company last year engaged the services of Saudi investment advisory firm BMG Financial Group. In late 2020, BMG gained Capital Market Authority approval for Atlantic Healthcare’s pre-IPO prospectus and has since been actively fundraising $50 million in the Kingdom.

“BMG developed interest across a broad range of institutions and family offices. We are now in due diligence with a number of parties,” Toby Wilson Waterworth, chief executive at Atlantic Healthcare, told Arab News, adding that the $50 million target has already been “oversubscribed.”

Once the due diligence has been completed, the second phase will be a listing on the London Stock Exchange, and the third and final phase will be a secondary listing on Tadawul.

“We’re in the process of working to close the investment, and then the plan is to turn that into the IPO process. We’ve been speaking to a number of banks in London and in New York, and we’ve spoken to a number of banks in the Middle East,” Waterworth said.

“The plan to do the primary listing would be at the end of this year, maybe drifting into the beginning of 2022. And then, once we’ve done that, the plan would be to do the secondary listing,” he added.

Tadawul announced in September 2019 that it was to allow foreign companies to list on its exchange for the first time. If all goes to plan, Atlantic Healthcare could potentially be the first British company to dual list on Tadawul.

The success of Atlantic Healthcare’s IPO could also have wider implications. In the run-up to Saudi Aramco going public at the end of 2019 with its $25.6 billion IPO, there had been a long and competitive battle among global bourses to get the energy giant to launch a listing on a non-Saudi bourse, with London one of the most prominent potential partners.

Speaking at the Future Investment Initiative gathering in Riyadh in January, Crown Prince Mohammed bin Salman said Aramco could launch a second offering of shares in the near future. “This will yield a cash flow transferred to the Public Investment Fund (PIF) to be reinvested domestically and internationally for the benefit of Saudi citizens,” the crown prince said.

Yasir Al-Rumayyan, governor of the PIF and chairman of Aramco, said a few days earlier that the oil company could sell more “if market conditions are right.”

Waterworth believes that his company’s dual listing could set a precedent and give London a potential advantage in any future Aramco negotiations. “The London Stock Exchange is still keen to continue to build its international relationships. And it is keen to see the relationship with Tadawul develop,” Waterworth said.

Looking to the future, Waterworth believes that the success of the fundraising would value Atlantic Healthcare at around half a billion dollars and by the end of the decade, he is aiming to hit a revenue of around $2.5 billion per annum.

“We’ve got a vision for a highly profitable company. We are planning to go to market in the US and Europe and in the early part of the 2030s when we calculate internally that we have the potential to reach those sort of revenue numbers,” Waterworth said.

“At the moment, a top-four accounting firm is valuing the company at around $500 million dollars. In the pre-IPO, we are looking to raise against that valuation $50 million+. This will be a reference point going toward the full IPO,” he added.

As well as being a potentially lucrative financial destination, Waterworth believes that Saudi Arabia will also be a big market for Atlantic Healthcare’s products.