JEDDAH, 4 July 2007 — More than 764,000 Saudi subscribers have invested over SR305 million in the initial public offering of the Saudi Printing & Packaging Company (SPPC) during the last three days, registering an oversubscription of 257 percent.
Eissa Al-Eissa, the CEO of Samba Financial Group that manages the IPO, attributed the large turnout of investors to the company’s bright future. SPPC, one of the largest such companies in the Middle East, currently prints 55 newspapers and magazines.
Saudi Arabia is considered the largest printing market in the Gulf Cooperation Council accounting for 44 percent of the total Gulf market of SR6.7 billion ($1.7 billion). During the last three years the Saudi market achieved a growth rate of 8.3 percent.
The company offers 18 million shares worth SR396 million in the five-day IPO, which began on Saturday and ends today. Prospective investors can buy a minimum of 10 shares and a maximum of 100,000 shares at the rate of SR22 per share.
“For the 5.4 million shares worth SR118.8 million in offer for individual subscribers, over 764,000 people pumped more than 305 million, providing a coverage of 257 percent,” Al-Eissa said.
If the number of individual subscribers crosses 540,000, Samba, being the manager of the IPO, would have the right to increase the allocation of shares for them from 30 to 50 percent with the permission of the Capital Market Authority.
“The tremendous response to SPPC offering reflects the desire of Saudis to invest in successful national companies,” Al-Eissa said. About 95 percent of subscribers used electronic means such as the Internet, tele-banking and ATMs to complete procedures.
“The final outcome of the IPO will be announced next week while final allocation of shares and return of excess amounts will be done by July 9 after scrutinizing all documents received from participating banks,” the Samba chief said.