Aujan to raise $213m in IPO

Aujan Industries, a Saudi beverage company which makes Barbican non-alcoholic beer, plans to raise up to 800 million riyals ($213.3 million) by selling shares to the public as early as end-2007, its chairman said.

The company, which has appointed Samba Financial Group as adviser and lead manager for the IPO, plans to sell a 30 % stake for between 600 million and 800 million riyals, Adel Aujan told Reuters on the sidelines of a news conference.

This would value the firm at between 2.0 and 2.67 billion riyals. The company's paid up capital is at 200 million riyals.

"We expect the IPO to take place towards the end of this year or the start of next year," Aujan said. "We have completed nearly 75 % of the requirements. In two to three months we will complete all these requirements."

The company expects to almost double revenue to $500 million by 2009, one year ahead of an initial deadline, compared with $280 million in 2005, Aujan told reporters. Turnover would reach $400 million in 2007, he said.

Around 40 % of the turnover is generated in Saudi Arabia, 15 % in Iraq and the remaining 45 % in countries such as the United Arab Emirates, Algeria and India.

"The company makes a net margin of around 8 % (of turnover)," Aujan said.

The firm belongs to the Aujan family which started the business in 1905 as a small trading company in Bahrain.

Aujan will invest $100 million this year to open two plants in Iran to produce its Rani juice drink, Aujan said. Iranian partners would contribute 20 % of the equity.

"With a population of more than 70 million, Iran is a large market," Aujan said. The plants will ease logistics problems, supply bottlenecks and custom duties of up to 50 %, he said.

The firm is also considering opening a plant in either Algeria or Tunisia. "Our biggest market in North Africa is Algeria," Aujan said.

Aujan employs more than 2,200 people in 25 countries in the Gulf, the Levant and Central Asia, Aujan said.

Its main competitors for alcohol-free beer are Dutch brewer Heineken NV, makers of Fayrouz, and Carlsberg's Holsten.

The firm's other main product is Vimto, a bottled fruit syrup, which was first introduced nearly 80 years ago and has developed into other products such as carbonated drinks.

The company sells more than 10 million Vimto bottles across the Gulf during the Muslim fasting-month of Ramadan when it is popular, and dominates the diluted-drinks industry with more than a 90 % share, its Web site says.

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