OQBI intends to float 49% on MSX

BUSINESS REPORTER

MUSCAT, NOV 4

OQ Base Industries (SFZ) SAOG (under transformation) (OQBI), Oman’s only integrated producer of methanol, ammonia and LPG products, announced its intention to proceed with an initial public offering (IPO) and to list its ordinary shares for trading on the Muscat Stock Exchange (MSX).

The proposed offering is a step towards diversifying the company’s shareholder base, broadening the company’s network and visibility among key stakeholders and providing liquidity for shareholders.

OQ SAOC owns 100% of the capital of OQBI directly and through its subsidiaries, Takamul Investment Company LLC and OQ Salalah Industries Company SAOC

The subscription period for Category I and Category II investors is expected to commence in November 2024, after receiving the required approval from the FSA. Admission of the shares on the MSX is expected in December 2024.

Details of the offering, the Category I Offer and the Category II Offer (including large retail and small retail thresholds) will be included in the Offering Document which is expected to be published by the company prior to start of the subscription period. The completion of the Offering and Listing of the shares to trading on the MSX is expected in December 2024, subject to market conditions and obtaining relevant regulatory approvals in Oman, including approval of the Listing.

BankDhofar, Bank Muscat and Morgan Stanley & Co International plc have been appointed as joint global coordinators (JGCs) with each of BankDhofar and Bank Muscat also appointed as issue managers. In addition, Kamco Investment Company and BSF Capital have been appointed as Joint Bookrunners.

The Shariah Supervisory Board of Dhofar Islamic in the capacity of Shariah Advisor of the issuance has issued a pronouncement confirming that, in its view, based on the circumstances as at the date of this pronouncement, the Offering is Sharia compliant.

The Offering provides investors exposure to Oman’s only integrated producer of methanol, ammonia and LPG products (which comprise propane, butane, condensate and cooking gas). The company has strong fundamentals and a demonstrated track record of successful implementation of expansion. The company is active throughout the natural gas value chain, operating three advanced plants with a combined nameplate production capacity of 1,816 ktpa. OQBI is in a unique position, as it operates in the tax-exempt Salalah Free Zone, close to Oman’s largest port, Port of Salalah, acting as a gateway to markets across Europe, MENA and wider Asia. The company has a differentiated beneficial structure for investors, currently being a 100% government owned entity.

For the year ended in December 31, 2023, the company’s revenue was $510 million, and its adjusted EBITDA margin was 43.1 per cent.

Commenting on the ITF, Ashraf bin Hamed al Mamari, Group CEO of OQ, noted: “We are pleased to announce the upcoming public offering for OQ Base Industries, one of our key subsidiaries. This follows the success of three previous offerings, which drew high interest from investors. The strong demand has been fuelled by our solid financial performance, operational strength and attractive dividend policy. This strategic step reflects our commitment to growth and ongoing investment in the energy sector.”

Eng Ali bin Mohammed al Lawati, Chairman at OQ Base Industries, emphasised: "...that offering 49% of the company’s shares to the public is a pivotal step, advancing OQ’s growth and aligning with its ambitions to expand its product reach to global markets." He added that this move strengthens governance and transparency within the company.

Khalid bin Khalfan al Asmi, Chief Executive Officer at OQ Base Industries, stated: "We’re pleased to announce OQ Base Industries' intention to go public. This milestone is a testament to our employee’s dedication and the trust we’ve earned from clients and partners. Oman’s strategic location has been a key strength, supporting our competitive business model and increasing the global appeal of our products."