JEDDAH, 22 August 2006 — Officials at retail franchiser Fawaz A. Al-Hokair Group have a reason to smile now that the Capital Market Authority (CMS) has approved the initial public offering of the group’s holding, Fawaz Abdulaziz Al-Hokair & Co. The IPO will open for subscription beginning Oct. 7 and run through Oct. 16. The share allocation has been determined by the CMA to be between 25 and 25,000 shares.
To date, Fawaz A. Al-Hokair & Co.’s market capitalization is SR400 million ($104 million) comprising of 40 million paid ordinary shares with a nominal value of SR10 ($2.66) apiece. The business will be offering 30 percent of its share capital, or 12 million ordinary shares, through the IPO.
HSBC and Saudi British Bank (SABB) have been named as the financial advisers, lead managers, and underwriters of the IPO. The legal adviser is the law office of Mohammed Al-Sheikh with Deloitte & Touche Bakr Abulkhair & Company being the registered auditors and reporting accountants.
Ioannis Karapatakis, managing director of the Global Investment Banking Advisory of HSBC Saudi Arabia Limited, said, “Fawaz A. Al-Hokair & Co.’s performance is impressive. This IPO is indeed another milestone for the company and HSBC /SABB are very pleased and honored to be its advisors.” The company is currently the franchiser for over 42 top-tier international fashion retail brands merchandised through more than 600 stores Kingdom-wide. The group has announced aims to expand their retail network to over 800 stores and employ an astonishing 6,000 employees around the Kingdom by April 2007.
They are also the legal vehicles for the fashion retail business of Fawaz A. Al-Hokair Group, one of the top 10 trading entities in Saudi Arabia. Kamal M. Quadir, vice president of Investment Banking Services at Financial Transaction House, licensed by the CMA told Arab News, “Fawaz A. Al-Hokair is a well-managed diversified company... Saudi consumer spending is up and I believe it will continue to do so in the future.”
“My professional opinion is that this particular IPO will turn double even, triple digits in future earnings and revenue. Al-Hokair is the type of company Saudi Arabia needs,” he added. In the last fiscal year ending March 2006, Fawaz A. Al-Hokair Group generated over 4,000 new jobs, boasted an annual sales turnover of SR1.3 million, and net income increase of 41 percent from the previous year.