SAUDI ARABIA—Fourth Milling Company (MC4), a leading flour producer in the Kingdom of Saudi Arabia, has announced the price range for its upcoming initial public offering (IPO).
The company has set prices between SAR 5 (US$1.33) and SAR 5.30 (US$1.41) per share, with institutional book-building commencing on September 15.
The total size of the offering is expected to range between SAR 810 million (US$ 216 million) and SAR 858.6 million (US$ 228.9 million), with an expected market capitalization upon listing between SAR 2.7 billion (US$ 720 million) and SAR 2.8 billion (US$ 763.2 million).
The Capital Market Authority (CMA) approved Fourth Milling Company’s IPO on 26 June 2024G. 162,000,000 ordinary shares were offered, representing 30% of the company’s total issued share capital.
The institutional book-building period will close on 19 September 2024G, and the final offering price will be announced afterwards.
Riyad Capital has been appointed as the financial advisor, lead manager, bookrunner, and underwriter, while Riyad Bank and Arab National Bank will serve as receiving agents.
The offering is a secondary offering, meaning the proceeds from the IPO will be distributed to the selling shareholders. The company itself will not receive any proceeds.
Key Timelines
The institutional book-building process will run from 15 September to 19 September 2024G, while the subscription period for individual investors will open on 02 October 2024G and close on 03 October 2024G. The final share allotment will be announced on 06 October 2024G.
According to sources close to the company, the IPO is open to two categories of investors:
- Participating Parties: These include institutional investors eligible to participate in the book-building process. A maximum of 162,000,000 shares will be allocated to this group, representing 100% of the offered shares. However, if there is significant demand from individual investors, the allocation could be reduced to 129,600,000 shares.
- Individual Subscribers: This category is open to Saudi nationals, Gulf Cooperation Council (GCC) nationals, and non-Saudi residents in the Kingdom. A maximum of 32,400,000 shares will be available for individual investors.
The final allocation between institutional and individual investors will be determined based on demand.
The IPO is expected to contribute to the broader Saudi Vision 2030, which aims to diversify the economy and deepen the role of the private sector.
The Kingdom’s flour production sector has seen substantial growth due to rising domestic consumption and expanding food-related industries. MC4, being one of the major players in the flour industry, is positioned to capitalize on this growth trajectory.
The listing of Fourth Milling Company comes at a time of continued expansion in the Saudi financial markets.
The Tadawul (Saudi Stock Exchange) has seen a steady flow of new listings, reflecting increased investor confidence and the Kingdom’s push to modernize its economy through greater private sector involvement.
MC4’s IPO is expected to draw significant attention from both institutional and retail investors, given the company’s solid financial performance and its central role in Saudi Arabia’s food security strategy.
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