Oman’s Al Madina Insurance Company is set to float 66.7m shares in an initial public offering aimed at chieving Sharia-compliant status on the Sultante’s takaful system, it was reported.
Under Oman’s takaful regulations, insurance firms must be publicly listed to operate as takaful companies.
The company has already submitted a draft prospectus with the Capital Market Authority (CMA) and a final prospectus will be submitted soon, the Times of Oman newspaper reported.
The face value of the share will be 100 baisas ($0.27). The company, which has a paid up capital of OMR10m ($26m) will increase it to OMR16.67m ($43.3) through the share offer.
Eng Abdulrahman Awadh Barham, deputy chairman of Al Madina Insurance was quoted as saying that the offer would be 40 percent of the company's capital. He described it as a premium issue.
The Al Madina issue will be the third IPO in Oman this year after Sharquiya Desalination and Sembcorp Power.
Eng Barham said since the company is established and was a profit-making firm, making the issue attractive for investors.
Normally, takaful insurance firms do not make profit in the initial years. "We have gone through that period. We expect the takaful business of Al Madina to do very well,” he said.
It is compulsory for Islamic banks and window operations to insure their products only with takaful firms, though a lack of options meant companies were generally given a grace period.
"We do business with some of the Islamic banks and hope to expand our services to the entire market,” Eng Barham told the Times.