Oman's Abraj Energy Services plans March listing on Muscat stock exchange

Oman’s oil and gas drilling services firm Abraj Energy Services plans to list up to 49% of its shares on the Muscat stock exchange in March through an initial public offering (IPO), a company statement said on Sunday.

The IPO forms part of an exit plan recently announced by sovereign wealth fund, the Oman Investment Authority (OIA), the state news agency said.

State energy company OQ, the selling shareholder, is wholly-owned by the OIA, which expects to exit eight investments in 2023 to generate about $1.3 billion.

A diversified oil and gas services firm, Abraj is the largest drilling contractor in Oman with a market share of almost 30 percent.

“We believe the Company’s future is very bright, not least because it is already pre-qualified in four countries to conduct a range of services, setting the stage for international expansion geared towards delivering growth and shareholder value,” Abraj Chief Executive Saif Al Hamhami said.

The company’s return on equity was 13.6% in the first nine months of 2022, and it expects to pay a dividend of 85% of profit for last year, in 2023.

Ahli Bank Oman, EFG Hermes UAE and National Bank of Oman are acting as global coordinators on the IPO which will be open to investors in Oman, and international investors outside the United States. The subscription period is expected to begin in February.

The Gulf region was a rare bright spot for new IPOs last year, but the market was largely dominated by the United Arab Emirates and Saudi Arabia pushing state-led listing programmes in a bid to advance privatisation strategies.

States such as Qatar and Oman are now seeking to capitalise on investor appetite for Gulf IPOs and compete with more active regional exchanges.

($1 = 0.3840 Omani rials)