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Fourth Milling Company (MC4) is guiding on a price range of SAR 5-5.3 for its IPO on the Tadawul, according to a disclosure to Tadawul by the offering’s financial advisor, bookrunner, and underwriter, Riyad Capital. The company could raise as much as SAR 858.6 mn (USD 228.8 mn) from the offering, by our math.
REMEMBER- The state-owned milling company is offering a 30% stake (162 mn shares) in a secondary share sale, according to the offering’s prospectus (pdf). The story was also picked up by Reuters.
Bookbuilding for institutional investors kicked off yesterday and will continue until this Thursday, 19 September. Institutional investors can subscribe to the entire offering, with a maximum allocation of 27 mn shares and a minimum of 300k shares each.
Market cap + proceeds: At the top of the range, MC4’s market cap will stand at SAR 2.9 bn at listing. Proceeds will go directly to the selling shareholders after deducting SAR 23 mn for offering-related expenses. Selling shareholders will not be able to sell down their positions for a period of 6 months starting from the first day of trading.
What’s next? The retail subscription process is set to kick off on Wednesday, 2 October and run for two days. Retail investors may receive up to 20% of the shares on offer if there is sufficient demand, with a maximum subscription limit of 250k shares and a minimum of 10 shares per investor. The final allocation of shares will take place on Sunday, 6 October and excess subscription fees are set to be refunded by Wednesday, 9 October.
Post-IPO ownership structure: MC4 is currently 100% owned by Allana International, Abdullah AlOthaim Markets and United Feed Manufacturing, with each holding equal shares. Their post-IPO holding will settle at a combined 70% stake.
ADVISORS- Riyad Capital is quarterbacking the transaction as lead manager, financial advisor, book-runner and underwriter, with Baker Mckenzie providing counsel to the issuer. PwC is financial due diligence advisor, Euromonitor International was tapped as market study consultant, and EY is auditor. Riyad Bank and Arab National Bank are receiving agents. Meanwhile, Khoshaim & Associates is counsel to Riyad Capital.
IN OTHER IPO NEWS-
The retail subscription period for Almajed for Oud’s Tadawul IPO wrapped up yesterday, with the final share allocations scheduled to be announced on Thursday, 19 September. The perfume retailer is taking a 30% stake to the main market (equivalent to 7.5 mn shares) at SAR 94 apiece. Institutional book building for the offering wrapped up in late August.
