OQEP, the exploration and production arm of Oman’s state oil group, has announced that it has successfully raised $2.03 billion through its initial public offering (IPO) on the local stock exchange, marking the largest listing in the Gulf country’s history.
The company is offering approximately 2 billion shares, representing a 25 percent stake, and stated that the offering was priced at the upper end of its indicative range of 370-390 baizas per share. The IPO was oversubscribed by about 2.7 times, including commitments from anchor investors.
Strong backing from institutional investors worldwide has led to a demand exceeding OMR1.0 billion (excluding anchor investors) for the Category I offering, resulting in an oversubscription rate of approximately 3.4 times. This IPO is around 2.6 times larger than the previous record IPO in Oman. Institutional investors who placed orders in the Category I offering at Bzs 390 per share will receive about 29.8 percent of their requested shares.
Additionally, support from over 113,000 individual subscribers has generated over OMR610 million in demand for the Category II offering, marking the highest retail demand for an IPO on the MSX to date, with an oversubscription level of approximately 2.2 times.
Strong investor demand
Ahmed Al-Azkawi, chief executive officer of OQEP, expressed his excitement about the outstanding results of the IPO subscription process. He noted that it was gratifying to see that investors appreciated the company’s strong record in value creation, operational excellence, and financial performance. He mentioned that the company eagerly anticipates the next stage of growth as a publicly listed entity. Al-Azkawi emphasized that the widespread support from both institutional and retail investors across Category I and Category II offerings underscored the strength of the business model, the quality of the portfolio, and the ambitious growth strategy, all of which present a compelling value proposition recognized by the global investment community.
Oversubscription and allocation details
The offerings in Category I and Category II were oversubscribed by approximately 3.4 times and 2.2 times, respectively, with limited order inflation and significant backing from a diverse array of high-quality international, regional, and local investors. In addition, investors in the Category I offering will receive 29.8 percent of their requested shares. Category II investors (small retail) will be allocated 100 percent of their demand up to 8,000 shares, with around 23 percent of their demand above that threshold. Large retail investors in Category II will further receive about 32.6 percent of their requested shares.
Read more: Oman’s OQ IPO $771 million IPO oversubscribed
Share capital and ownership structure
Furthermore, in total, approximately 2.0 billion ordinary shares, representing 25 percent of OQEP’s issued share capital, were made available to investors. OQ SAOC (OQ) will retain ownership of the remaining 75 percent of the Company’s share capital after the IPO concludes.
Upon listing, OQEP will boast a market capitalization of OMR 3,120 million (around $8.1 billion), making it the largest entity on the MSX by market capitalization. Additionally, this represents about 25 percent of the total market capitalization of the MSX, in addition to the offering size, which marks the largest IPO in Oman’s history. The IPO is 2.6 times larger than the previous record held by OQ Gas Networks in 2023, setting a new benchmark on the MSX.
Moreover, trading of OQEP shares is anticipated to begin on the MSX on or around 28 October 2024 under the symbol “OQEP” and ISIN OM0000009759.
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