Shareholders requested lower percentage for listing
Oman Arab Bank’s (OAB) shareholders have asked to float 25 per cent of the bank’s shares on the Muscat Securities Market instead of the minimum 40 per cent so that Bahraini partner Arab Bank’s management control is maintained.
The firm, which is 49 per cent owned by Arab Bank and 51 per cent owned by local company Omnivest, is working on selecting a financial adviser for its initial public offering (IPO), which is scheduled for early next year.
“It is too early to judge the valuation and share price due to the current market scenarios. You cannot get a good valuation at the moment because of the liquidity issue in the markets and the existing yield is too high,” says Lo’ai al-Bataineh, deputy general manager, investment and development at OAB.
According to Al-Bataineh, OAB’s primary reason to float its stock is not to increase capital, but as a long-term strategy.
“We have already reached our target capital for 2012. The potential to expand without it [IPO] would be useless, we have to match the shareholders expectations and bank’s requirements,” he says.
OAB received government approval to float less than the required 40 per cent at the end of August.
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