Nass Corporation B.S.C. IPO a boost for Saudi institutional investors

The IPO has seen a tremendous outpouring of Saudi investors keen on becoming a part of this unique offering. The most attractive and convenient aspect for institutional investors in Saudi is that Gulf Investment Bank (GIB), Riyadh have been approved by the Saudi Monetary Authority as the placement agent for Saudi Arabia. GIB Riyadh has reported very significant interest by institutional investors to invest in this prestigious IPO.

The main attraction for investors is a rare combination of firsts for a Bahrain-based IPO; It's the first family owned construction sector conglomerate in Bahrain to go public; at 50 million shares, it's the largest IPO in Bahrain for eight years and it's the first open to investors of all nationalities, thanks to Bahrain's forward looking regulations.

"The Bahrain Stock Exchange offers attractive valuations for investors as it has not yet peaked, as other GCC markets have over the past three years. The reason for this is that there has not been much liquidity in stocks in the BSE up until now. When coupled with the fact that there existed no pipeline for Initial Public Offerings, we can see why investors were previously wary of investing in Bahrain's market," said Hisham Al Saie, head of corporate finance at Securities and Investment Company B.S.C(c) (SICO), the IPO lead manager.

"This has changed now, and we believe the Nass Corporation IPO is the first to trigger an already increasing regional interest in the BSE," he continued.

"Starting with Nass Corporation, there are a number of major IPO in the pipeline over the next five to seven months. We will likely be seeing a substantial surge in volume and value of transaction on the BSE as available free-float from these IPO hits the market. Once this takes place, other listed companies on the BSE might start having increased trading volumes even in existing illiquid equities due to the fact that many local investors on the BSE might start re-allocating and re-structuring their Bahraini portfolio and direct funds into new investment opportunities," said Mr. Al-Saie.

"Once completed, the allotment basis will be finalized by the lead managers in consultation with Bahrain Monetary Agency (BMA) in a manner that will be equitable for both the smaller as well as the big institutional investors," he continued.

With the current boom in the construction sector looking set to stay, the Nass IPO represents a solid addition to the portfolios of those who subscribe.

Nass Corporation B.S.C. is allocating 25% of its shares, a total of 50 million ordinary shares, through the IPO process, which closes in the next five days. The Nass founding shareholders will retain a majority stake in the corporation, which already completed a private placement of 24% of shares with a group of 15 GCC strategic investors in June this year.

Securities and Investment Company B.S.C.(c) (SICO) is the lead manager and co-financial advisor on the transaction. KPMG Corporate Finance is also co-financial advisor on the transaction. Trowers & Hamlins is the legal advisors and Baker Wilkins & Smith, the technical evaluator.

The subscription period closes at 12pm on October 30, 2005. Details of allocations will be published in Bahraini newspapers within 2 weeks of the subscription closing, at which time trading is scheduled to begin.

Applications are invited from investors of all nationalities, who can collect a copy of the IPO prospectus and subscription forms in Bahrain from the Manama, Adliya and Muharraq branches of HSBC and the office of the Registrar, KPMG-Shares Registrar Department, Al-Hedaya Building, Government Avenue. The same can be obtained from Gulf Investment Bank (GIB) in Riyadh, Saudi Arabia.