Riyadh: Saudi Arabia’s largest pharmacy retail chain has hired the local unit of HSBC Holdings Plc and the investment banking arm of the Saudi National Bank in what could be the kingdom’s biggest IPO since Aramco’s IPO in 2019.
Nahdi Medical Co. plans to sell a 30% stake, or up to 39 million shares, in an initial public offering, according to a statement. The offer price will be determined after a period of bookbuilding.
The pharmaceutical chain is seeking a valuation of around 16 billion riyals ($4.3 billion) in the IPO, people familiar with the matter said earlier this month. The company, half-owned by Jeddah-based investment firm Sedco Holding, received regulatory approval for listing in December.
Nahdi Medical has a network of pharmacies with 1,151 points of sale in 144 cities. It achieved a turnover of 8.6 billion riyals and a profit of 849 million riyals for 2020.
More and more family businesses in Saudi Arabia are listed on the kingdom’s stock exchange as equity sales see huge investor demand, with most IPOs being offered at the top of the offering ranges. The most recent wave has already seen a digital security company owned by the Saudi wealth fund attract around $57 billion in orders from institutional investors.
Saudi companies raised nearly $9.3 billion through equity offerings last year, making it the most active IPO market in the Middle East and Africa behind Israel, according to data compiled by Bloomberg. ACWA Power International’s $1.2 billion IPO last year was the largest since Aramco raised nearly $30 billion in the largest-ever stock offering in the world.
Last week, Al Dawaa Medical Services Co., another pharmaceutical retailer in Saudi Arabia, said it was looking to raise around $500 million through an IPO.