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LANDMARK IPO

Omani bank Al Izz to offer 400m shares

Dubai, September 16, 2012

Al Izz Islamic Bank, the second sharia-compliant lender being formed in Oman, plans to offer a total of 400 million shares at a fixed offer price of 102 bizas in its initial public offering (IPO) next week.

The announcement from the company comes after receiving approval from the Capital Market Authority of Oman in this regard.

Al Izz islamic bank is being promoted by Huriah Company owned by Sayyid As'ad bin Tarik Al Said, Abu Dhabi-based Aabar Investments, First Energy Oman, a wholly-owned subsidiary of Bahrain-based First Energy Bank and Tasameem Real Estate Company, an investment company headquartered in the UAE.

With its launch, Al Izz will become one of the first Islamic banks in Oman to offer comprehensive business and retail Islamic banking solutions, remarked Jamal Darwiche, the bank's chief operating officer designate.

"Islamic banking in Oman has the potential to draw unbanked sections of the population into the banking market. Against the GCC average of 114 per cent, Oman’s banking penetration was at 70 per cent in 2010, suggesting ample room for growth in the Omani banking sector including Islamic banking," Darwiche stated.

"By 2015, Islamic banking assets in Oman are expected to exceed RO2 billion representing 10 per cent of total banking assets. With strong and experienced promoters, Al Izz islamic bank is well positioned to become the market leader by leveraging its early mover advantage," he added.

The subscription will be open for both eligible Omani and non-Omani investors starting from September 22 till October 21.
 
The promoters have already contributed RO60 million ($155.4 million) representing 60 per cent of the share capital of Al Izz Islamic Bank and have invited investors to participate in equal commercial terms under the IPO to become shareholders in the Omani Islamic bank.

Up to 60 per cent of the shares on offer in the IPO have been reserved for small investors who apply for 100,000 shares or less and the balance has been reserved for large investors who apply for more than 100,000 shares, said Darwiche.

The offer proceeds along with the capital will be used to fund the bank's pre-commercial launch operating costs and initial operations, until such time as Al Izz’s cash flows are sufficient to meet these expenses, he added.

The bank will be constituted on completion of the IPO with a paid up share capital of RO100 million.

BankMuscat's investment banking division is the financial adviser, issue manager and one of the six subscription banks for the IPO. The other subscription banks are Ahli Bank, Bank Dhofar, Bank Sohar, National Bank of Oman and Oman Arab Bank.
 
The offer price for each share has been fixed at Baisa102, which comprises the nominal value of Bzs100 per share and a Bzs2 per share contribution towards the issue expenses of the IPO.

The IPO has been fully underwritten, at the offer price of Bzs102 per share, by seven banks and investment companies in Oman comprising Bank Muscat, Ahli Bank, Bank Dhofar, Bank Sohar, The Financial Corporation Company, United Securities and Gulf Baader Capital Markets.-TradeArabia News Service




Tags: IPO | Oman | Aabar | Shares | Islamic bank | subscription | Al Izz |

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