flynas Concludes Final Share Allocation for Its IPO

Saudi Arabia’s low-cost carrier flynas Company, one of the leading low-cost carriers in the Middle East and North Africa, has announced that it has completed the final share allocation for its initial public offering (IPO).

The final offer price was set earlier at $21.33 per share, the top end of the previously announced price range, implying a market capitalisation at listing of $3.6 billion.

This followed strong demand from institutional investors, with the institutional tranche being oversubscribed approximately 100 times, generating orders of over $109.05 billion from local and international investors.

A total of 10,251,114 shares were allocated to retail investors, representing 20% of the total offering. With a coverage of 349.7%, it also reflected strong interest from individual investors, the company said.

Each retail investor was allocated a minimum of 10 shares, with the remaining shares allocated on a pro-rata basis in proportion to the size of demand, resulting in an average allocation factor of 12.3%. Any surplus subscription funds will be refunded to retail investors no later than 5 June 2025.

The company’s shares are expected to be listed and commence trading on the Main Market of the Saudi Exchange (Tadawul) following the completion of regulatory formalities with the Capital Market Authority (CMA) and the Saudi Exchange.

The listing date will be announced in due course and this is the region’s first IPO of a major airline since 2008 and only the third-ever carrier to list in the GCC after Air Arabia and Jazeera Airway.

Tourism Targets

It may be recalled that Kingdom’s travel and tourism sector is expected to contribute 10% or higher to GDP this year. The Saudi Tourism Ministry has set a target to attract 150 million tourists by 2030, up from around 104 million in 2023.

According to media reports, the $1.09 billion offering is the Kingdom’s largest so far this year, much higher than the IPOs of Umm Al Qura for Development ($530 million) and Almoosa Health ($450 million). It is also ranked as the highest-grossing Saudi IPO since Aramco’s $29.4 billion IPO debut in 2019.

Hurdles Likely

The reports also said that Flynas may still be facing some hurdles from ongoing aircraft supply chain disruptions, as Airbus, its primary supplier, has warned airlines of delivery delays up to three years due to shortages in engines and components.

While flynas has not reported any specific setbacks, it has over 160 aircraft on order in a transaction valued at $30 billion through 2030, potentially exposing it to the industry-wide bottlenecks, the reports said.