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Mon 2 Sep 2019 10:23 AM

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Boursa Kuwait plans IPO in Q4 after CMA approval

50% of company to be offered to public, with 44% in private hands and 6% retained by government

Boursa Kuwait plans IPO in Q4 after CMA approval
Upon listing, 50 percent of Boursa Kuwait's shares will be owned by citizens and the private sector (44 percent), while the Kuwaiti Government, through the Public Institution for Social Security, will retain the remaining 6 percent.

Kuwait’s Capital Markets Authority (CMA), the regulatory body for securities and current owner of 50 percent of Boursa Kuwait Securities Company (Kuwait’s only stock exchange operator), is to launch an initial public offering (IPO) of its shares in the exchange in the fourth quarter of 2019.

The privatisation process is being implemented in two phases. The first took place earlier this year in February where a consortium comprised of Athens Stock Exchange, National Investments Company, First Investment Company and Arzan Financial Group, acquired a 44 percent stake in the company.

The second phase, the nationwide IPO, is expected to be implemented in the last quarter of 2019 with the distribution of the CMA’s 50 percent stake in the company to citizens.

Upon listing, 50 percent of Boursa Kuwait's shares will be owned by citizens and the private sector (44 percent), while the Kuwaiti Government, through the Public Institution for Social Security, will retain the remaining 6 percent.

The privatisation of Kuwait’s stock exchange, which was founded in 2014 by the CMA, is another step towards achieving the ambitious national development goals set out in Kuwait Vision 2035 with an aim to strengthen the country’s position as a regional financial centre and give the private sector a stronger role and a greater opportunity to develop the national economy.

Earlier this year it was announced that Boursa Kuwait is to be added to MSCI’s main index tracking stocks in emerging markets in June 2020.

Chairman Hamad Al-Humaidhi said the reclassification was an "important milestone" and "will bolster the country’s standing on the global investment map".

The Gulf country, whose $98 billion stock market is similar in size to those of New Zealand and Ireland, is currently the biggest member of the MSCI’s main frontier gauge.

The reclassification, which is expected to lead to significant foreign capital flows to country’s equities, will take effect in one step coinciding with MSCI’s May 2020 Semi‐Annual Index Review.