Saudi Arabia to allow foreigners to own 49% of listed firms

Stock market regulator also raises limit for a single qualified foreign investor in a company to 10%
(KARIM JAAFAR/AFP/Getty Images)
By Bloomberg
Tue 09 Jan 2018 07:59 PM

Saudi Arabia will allow foreign investors to own up to 49 percent of listed securities as the kingdom opens up its stock market and plans what could be the world’s biggest initial public offering.

The regulator raised the limit for a single qualified foreign investor in a company to 10 percent and set the ceiling for foreign holdings in all categories, whether resident or non-residents, at 49 percent, the Capital Market Authority said in a statement on Tuesday.

In an initial proposal in 2014, the regulator had set a 5 percent limit for a QFI in a single company.

The CMA also lowered the level of assets under management or custody investors must have to 1.875 billion riyals ($500 million) from 3.75 billion riyals, saying it may reduce this further still.

That’s just one 10th of the initial proposal of 18.75 billion riyals. The formal approval of the new requirements, which take effect April 1, affirms an amended draft proposal from November.

Saudi Arabia is opening up its stock market as it takes steps to wean the economy off oil. The government plans to create the world’s largest sovereign fund and sell hundreds of state assets in the process, including Saudi Arabian Oil Co, as well as stakes in the stock exchange, football clubs and flour mills.

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Last Updated: Tue 09 Jan 2018 07:03 PM GST

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