RIYADH, 8 February 2007 — Al-Malaz Cooperative Insurance and Reinsurance Co. netted over SR202 million in the first three days of the public flotation which was launched on Saturday. The flotation will end on Feb. 12. The company has offered 47.48 percent of its SR300 million capital for public subscription, which represents 14.2 million shares. This is considered the highest percentage of capital offering among the newly established insurance companies.
HSBC Saudi Arabia Ltd., the IPO financial advisor and SABB, the IPO sole underwriter, announced earlier that the subscription amount reached SR202 million, while the coverage stood at 142 percent by the end of the third day of the subscription period.
The company, the first to go public from the insurance sector, used direct subscription channels (internet, telephone banking and ATMs) representing over 75 percent of the coverage. This helped in easing overcrowding in banks.
Commenting on the flotation, Mubarak Al-Khafra, chairman of Al-Malaz Cooperative Insurance and Reinsurance Co., said the high demand for Al-Malaz shares reflects the strength of the Saudi economy and the keenness of investors to participate in IPOs in the Saudi market.
Al-Khafra added that “we are confident that our national economy is one of the top economies in the world, especially after the recent reforms in various economic sectors, including the cooperative insurance sector. In addition, the last regulations introduced by the Saudi Arabian Monetary Agency (SAMA) were very helpful in leveraging this industry.”
Ioannis Karapatakis, managing director of Global Investment Banking Advisory in HSBC Saudi Arabia Ltd., said “this high demand reflects progress in the Kingdom’s investment sector.”