Two Saudi Firms Announce IPOs on Saudi Parallel Market

Mufeed company and Al Fakhera, the two Saudi-listed firms on Saudi Arabia’s parallel market NOMU, have been given a go ahead by the Capital Market Authority (CMA) to offer 10% and 20% of shares of the respective companies.

Mufeed is a production and event planning company and Al Fakhera a clothes retailer of maker of thawb an Arab garment mainly worn by inhabitants of the Middle East and North Africa (MENA) region, according to the prospectus issued by these two companies.

While Mufeed will offer 10% stake totalling 600,000 shares (9.09%), Al Fakhera’s is offering 20% stake (6 million shares) to be prospective shareholders. The offering of the shares of the two companies will run from on November 3 and end on November 11.

Qualified investors can subscribe to 100% of the offering. Each investor can subscribe to a minimum of 10 shares, and a max of 323,000 each. The final allocation of shares is slated for November 14, while refunds (if any) will take place on November 18.

Mufeed’s offer will be confined to Qualified Investors stipulated in the glossary of Defined Terms Used in the regulations and rules of CMA, the regulator and developer of Saudi Capital Market.

Mufeed will use $718,983 of the proceeds to cover costs related to the offering, while the remaining amount is earmarked to hike the company’s capital to $1,75,1515 million, up from the current $1.6 million. This is in addition to financing some of Mufeed’s expansion plans. None of the proceeds will be distributed to shareholders.

Founded in 2009, Mufeed operates five specialised subsidiaries — Evex, I-Focus, Innov8, White Light, and SCurve — offering comprehensive event management and organisation services. Their expertise spans documentation, photography, TV production, broadcasting, and marketing campaigns. Additionally, they manage ticketing, exhibitions, and conferences.

Al Fakhera IPO

Al Fakhera has earmarked the proceeds to buy new assets and finance its working capital as part of its growth plans, according to its prospectus. Net proceeds from the sale will go towards shoring up the company’s capital after covering costs related to the offering, with no part allocated to shareholders.

The IPO will be limited to qualified investors, who can book up to 1.8 million shares each, with the lower limit set at 100 shares.

The combined ownedship of Al Fakhera, whose substantial shareholders are Suleiman Hammad Al Yahya and the Sulaiman Al Hamad Al Yahya Islamic Charitable Endowment, will be reduced from existing 95% stake to 79.2% post-IPO.

Al Fakhera has reported a net income of $2.26 million in H1 of 2024, – down 33.2% y-o-y on the back of higher selling and marketing expenses, according to the company’s unaudited financial results in the prospectus.

Founded in 1976, Al Fakhera operates over 100 branches across the Kingdom, according. The retailer specialises in the design and crafting of the traditional Saudi thawb, offering tailoring services catered to men of all ages. It also owns and runs the largest detailing factory in the region.