Kingdom Holding's share offering was double oversubscribed despite religious edicts, attracting $2.3 billion.
A share offering by Prince Alwaleed bin Talal's Kingdom Holding attracted 8.53 billion riyals ($2.3 billion), more than double the amount the billionaire wanted as Saudi investors ignored religious edicts.
More than 1.25 million Saudis applied to buy shares in Kingdom's initial public offering of a 5% stake, or 315 million existing shares at 10.25 riyals each. The IPO valued the company overall at $17.2 billion.
Some clerics had issued edicts discouraging investors from buying shares in Kingdom, saying the company's investments in hotels and banks violated Islam's ban on usury and alcohol.
Similar denunciations have had little impact on previous Saudi initial public offerings.
Prince Alwaleed, a nephew of King Abdullah, was looking to raise 3.23 billion riyals in the IPO that closed on Wednesday. Half the offering was allocated to institutional investors.
"The response has been strong," Prince Alwaleed said in a statement on Sunday.
Kingdom's IPO was priced at around 67 times 2006 earnings, more than four times the average for the Saudi bourse, on which it will be the fifth-largest stock.
Prince Alwaleed's stake in Kingdom, which had $24 billion in assets at the end of 2006, will fall to 93.5% after the sale. His son and daughter are also shareholders.
Alwaleed has made billions of dollars by investing in underperforming companies and is the world's 13th-richest person, according to Forbes magazine.
The grandson of Saudi Arabia's founder took his company public after a stock market crash halved the value of the Saudi bourse last year and diminished the appetite for IPOs in the world's biggest oil-exporting region.
Prince Alwaleed is Citigroup Inc.'s largest individual shareholder. Kingdom Holding's portfolio also includes shares of Time Warner Inc., Apple Computer Inc., Motorola Inc. and News Corporation Inc. as well as Savola Group, the Gulf's largest food company by market value.
The Saudi index dropped 52.53% last year and is off 5.4% so far in 2007, making it the worst performer among 13 Arab benchmarks tracked by Reuters.
finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.