Kuwait stock mart plans share sale as early as this year

Cap­i­tal Mar­kets Au­thor­ity is con­duct­ing stud­ies for the ini­tial pub­lic of­fer­ing through the end of April

Gulf News - - Gulf -

Kuwait, which was clas­si­fied as an emerg­ing mar­ket by in­dex provider FTSE Rus­sell in Septem­ber, plans to sell a stake in its stock ex­change as early as this year.

The Cap­i­tal Mar­kets Au­thor­ity is con­duct­ing stud­ies for the ini­tial pub­lic of­fer­ing through the end of April, Vice-Chair­man Mishaal Al-Usaimi told Bloomberg TV. “From that we will have a very clear time­line tak­ing us to the IPO, but we are hope­ful that we will com­plete that by the end of the year.”

Kuwait’s bourse is com­pet­ing with Saudi Ara­bia’s to be­come the sec­ond in the six­na­tion Gulf Co­op­er­a­tion Coun­cil af­ter the Dubai Fi­nan­cial Mar­ket to raise cash through an IPO. The na­tion ex­pected in­flows of hun­dreds of mil­lions of dol­lars from in­vestors af­ter the FTSE up­grade, and while AlU­saimi said in­ter­est in Kuwaiti stocks re­mains “buoy­ant,” he ac­knowl­edged that liq­uid­ity “re­mains an is­sue.”

The na­tion’s bench­mark in­dex has 156 mem­bers, at least 40 of which have been un­changed by the close of trad­ing since 2006, when Bloomberg be­gan track­ing the data. The gauge last year rose 11 per cent, the most since 2013, and posted an an­nual profit of 3.5 mil­lion di­nars (Dh42.97 mil­lion; $11.7 mil­lion). That “comes on the back of sev­eral years of losses,” Al-Usaimi said.

The share sale in the ex­change will con­sist of an of­fer­ing as much as 50 per cent to the pub­lic and up to 24 per cent to state en­ti­ties, the CMA said last month. It also hired a con­sor­tium led by Tri In­ter­na­tional Con­sult­ing Group to ad­vise on sell­ing as much as 44 per cent of Boursa Kuwait to a for­eign ex­change op­er­a­tor.

Two or three com­pa­nies may sell shares through IPOs that could raise about 80 mil­lion di­nars this year, the ex­change’s chief ex­ec­u­tive of­fi­cer Khalid Ab­dul Raz­zaq Al Khalid said at a con­fer­ence in Dubai. The bourse also plans to start the sec­ond phase of re­forms on April 1, which will in­clude sep­a­rat­ing equities into three cat­e­gories based on mar­ket cap­i­tal­i­sa­tion and trad­ing vol­ume, he said.

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