JEDDAH, 27 December 2005 — The initial public offering (IPO) of Yanbu National Petrochemicals Company (YANSAB) is in its second and final week, as it will end on Thursday. Amazingly, in less than two weeks, 5.7 million Saudi participants pumped in more than SR3.8 billion into the IPO, an amount double of the required capital of SR1,968,750,000.
Still, more surprising, is the age and gender distribution of the participants and the manners in which they used to participate in the IPO. According to the IPO manger, Samba Financial Group, in addition to the huge number of Saudis that participated, which equal one third of the Kingdom’s native population, the IPO was successful due to the increase in the use of electronic payment methods.
The gender distribution of the participants for this IPO was quite impressive compared to earlier IPOs in the Kingdom. Samba announced that YANSAB’s IPO witnessed an increase in the participation of Saudi women compared to their participation in the IPO of Bank Albilad.
Out of the 5.7 million total participants, women participation, until Sunday, was estimated at eight percent. Samba adds that 14 percent out of its client base that participated in the IPO was female participants.
Turning to the age distribution, Samba statistics show that the participants came from all age brackets. Nineteen percent of the participants were under 25 years, and youth between 25 and 39 were the majority of participants at 39 percent. Interestingly, one percent was above 80 years old, and participants between 60 and 79 years of old were 10 percent. The second majority age group in the IPO was that of 40-59 years old. Its participation was estimated at 31 percent.
The ease in which investors participated is reflected in the number who used electronic methods of payments. Samba announced in its daily report on the IPO that 57 percent of the IPO operations was conducted through electronic transactions. Out of the 57 percent, the participation through phone banking was 20 percent, followed by the Internet at 19 percent. Participation through ATM machines was 18 percent. The statistics show that people relied on phone banking more than other electronic methods although the numbers were very close between all them. This reflects an increase in people’s awareness and their attraction to technology.
More money is expected to be pumped into the IPO since this week is the pay week in the Kingdom. The minimum amount of issued shares for each person is set at 10 shares, and the maximum is 5,000 shares. However, if the number of prospective shareholders participating in the IPO exceeded 3,937,500 people then each person will get less than the minimum amount of shares as the shares will be distributed equally among the number of actual participants.