Senior gov't official says Kuwait Stock Exchange may offer up to 44% of its shares to foreign bourse operator
The Kuwait Stock Exchange may offer up to 44 percent of its shares to a company that has experience in operating bourses when it goes public, a senior government official told Reuters on Thursday.
Such a move, which still requires the sign-off by lawmakers in the Gulf Arab state, would open the way for an international exchange operator such as Nasdaq OMX or Euronext to take a stake in one of the Middle East's oldest stock markets.
Kuwaiti lawmakers voted on Wednesday to amend the ownership structure for the impending initial public offering (IPO) of the bourse, Faisal al-Shaya, head of the Kuwait's parliament's economic and financial committee, told Reuters by telephone.
A second and final vote on the law is expected at the next parliament session in two weeks, or a decision may be taken earlier by the economic and financial committee on behalf of the lawmakers, he said.
The IPO will take place once the amendments are passed, Shaya added.
Kuwait's bourse is set to be the second publicly listed stock exchange in the Gulf region after the Dubai Financial Market.
The planned listing, proposed in 2010, was part of a broader privatisation effort in the Gulf state in the wake of the 2008 global financial crisis.
However, Kuwait has suffered from periodic political gridlock which has seen numerous elections held and economic reforms delayed, most notably a 30 billion dinar ($100 billion) development package for infrastructure and other projects.
Under the plan passed on Wednesday, 50 percent of the bourse's shares will be offered to Kuwait's citizens.
In the Gulf, shares in government companies are sold to nationals at significantly-reduced values as a method of distributing wealth.
The remaining stock will be split between government entities, which will be entitled to own between 6 percent and 24 percent of the bourse's shares, while a "company with experience in managing bourses" may own from 26 percent to 44 percent.
Other stock markets in the Gulf have sold stakes to overseas exchange operators to help their development. Qatarbought out the remaining 12 percent in its bourse held by NYSE Euronext in October 2013.
A previous version of the Kuwaiti law said up to 10 companies could hold a combined 50 percent in the bourse, while the remaining 50 percent would be offered to citizens.