OQ chemical subsidiary targets $490m from IPO

OQ Base Industries, a subsidiary of Oman’s state energy company OQ, intends to raise up to OR187 million ($490 million) through an initial public offering on the Muscat Stock Exchange (MSX).

The price range was set between 106 and 111 baisas per share, valuing the company between OR188 million and OR385 million.

The subscription period for the IPO will run from November 24 to December 1.

The listing of Oman’s sole integrated producer of methanol, ammonia and LPG products will consist of 1.7 billion shares, or 49 percent of its total issued share capital.

The offering will be divided into 30 percent for institutional investors, 30 percent for anchor investors and 40 percent for retail investors in Oman.

Anchor investors Falcon Investments, Gulf Investment Corporation, Saudi Omani Investment Company and Social Protection Fund will each purchase 7.5 percent of the offering at the final subscription price of 111 baisas per share.

The shares are expected to begin trading on the MSX by December 15.

OQ Base Industries plans to distribute dividends twice per year following the IPO. It anticipates a dividend payout of OR32.7 million for 2024, with plans to increase the dividend by at least 5 percent annually until 2026.

OQ raised OR748.8 million ($1.94 billion) in October by offloading a 25 percent stake in its upstream subsidiary OQ Exploration and Production. The IPO was Oman’s largest so far

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OQ Gas Networks and another OQ unit, Abraj Energy Services, raised $749 million and $244 million respectively through IPOs last year.

The Oman Investment Authority, the sultanate’s sovereign wealth fund, owns OQ. Its five-year divestment plan includes initial public offerings in key sectors. 

There were 30 IPOs across the GCC in the first nine months of 2024, raising a combined $5.2 billion, which is 24 percent down on the same period in 2023, according to Kuwaiti asset manager Markaz.

However, a flurry of fourth-quarter flotations could enable the 2024 totals to equal or eclipse the 2023 figures.