Biggest Saudi IPO since Aramco set for Riyadh trading debut

Dubai: ACWA Power International, Saudi Arabia's first $1 billion initial public offering since Aramco, is set to start trading in Riyadh on Monday.

The $1.2 billion IPO drew interest from investors looking for exposure to a business seen as key to the kingdom's plans to diversify its economy away from oil. Initial demand amounted to several billion dollars and advisers had to limit institutional investors' allocations, Bloomberg reported.

Riyadh-based ACWA, half-owned by the kingdom's sovereign wealth fund PIF, is selling an 11.1 per cent stake at 56 riyals ($14.93) apiece, the top end of the offer range. The company will be valued at $10.9 billion and the PIF will continue to own a 44 per cent stake after the IPO.

Riyadh has been the hottest market for IPOs in the Middle East over the past years, though Abu Dhabi is catching up.

ACWA Power International, one of the kingdom's main vehicles for building renewable energy projects, on Tuesday priced its IPO at the top end of an original range, seeking to raise $1.2 billion. It is set to be the biggest offering in Riyadh since Saudi Aramco's listing in 2019. While Aramco's record IPO in 2019 offered investors a slice of Saudi Arabia's oil riches, ACWA dangles access to the renewable energy and hydrogen projects the nation sees as its future. ACWA, half-owned by Saudi wealth fund PIF, is expected to deliver at least 70 per cent of the kingdom's renewable projects by 2030 and expects to meet its own net-zero emissions goal before an existing target of 2050.

The IPO is expected to be "significantly oversubscribed," said Naveed Naz, financial controller of AlJammaz Group, a Riyadh-based family-owned agriculture and technology company that participated in the bidding process. "We expect the company to be able to deliver its growth plans and triple in size within the next 7 to 10 years."