Following the massive institutional interest in its initial public offering (IPO), Flynas, Saudi Arabia’s budget airline, has priced it at SAR80 (US$21.33) per share – at the top of the price range.
The institutional book building closed on 18 May, and the portion reserved was oversubscribed nearly 100 times, attracting orders of SAR409 billion (US$109 billion) for the IPO that is scheduled to raise SAR4.1 billion (US$1.1 billion) from the 51.3 million shares being floated (30 per cent of the company’s share capital).
Sale of the second tranche for retail investors begins on 28 May and ends on 1 June. Final allocation is scheduled to be completed on 3 June.
The company is offering 17.42 million new ordinary shares and 33.82 million of existing ordinary shares during the offer.
Following the completion of the IPO, part of the net proceeds will be used to finance the company’s incentive programme and also distributed to the selling shareholders on a pro-rata basis. From the sales of the new shares, 34 per cent will be used to finance its growth strategy and for general corporate purposes.
At SAR80 per share, the market capitalisation of Flynas will be SAR13.7 billion (US$3.65 billion).
Backed by Saudi billionaire Prince Alwaleed Bin Talal, Flynas is the first airline IPO in the region in nearly 20 years after Air Arabia and Jazeera Airways.
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