RIYADH, 23 June 2005 — Almarai, which is set to launch its initial public offering (IPO) on July 4, has forecast a profit of SR380 million for 2005.
“The company has recorded profits during the past 10 years and hopes to make a profit of SR380 million by the end of this year,” said Prince Sultan ibn Mohammed ibn Saud Al-Kabeer, the chairman of Almarai Company.
He was speaking to newsmen at the offering of 4,500,000 shares through five banks in the Kingdom. Although each share is fixed at SR512, the prince pointed out that the strength and viability of the establishment will lend added value. The company will also distribute its dividends for the year 2005 to all its new shareholders, he added.
Hong Kong and Shanghai Banking Corporation (HSBC) will be the financial consultant for the IPO while the Saudi British Bank will manage it as the lead underwriter.
The SAMBA Financial Group, Riyad Bank, Banque Saudi Fransi and Arab National Bank will also be underwriters. The Saudi British Bank will handle 50 percent of the total shares while each of the other four banks has been given 12.5 percent.
Prince Sultan said that the allocated shares constitute 30 percent of the Almarai Company’s capital. “We will try to process the allocation of shares as quickly as possible and we plan to refund the oversubscribed amount on July 18,” he said. Trading the shares is expected to commence on the stock exchange soon after the final allocation is announced.
Almarai which began operations in the Kingdom in 1976, is now the largest dairy food company in the Middle East. It concentrates on the production and sale of fresh dairy items as well as juices. With a herd of 45,000 cattle, it has a processing capacity of 1.4 million liters of milk a day in a 45,000 sq. meter facility. The company has 40 percent of the GCC market in fresh dairy products.