Shares of OQ Gas Networks (OQGN), the pipeline arm of Oman's state-owned oil giant OQ, climbed 13.6% on its trading debut on the Muscat Stock Exchange after raising $748.7 million (OMR 288.2 million) in an initial public offering (IPO) described as Oman’s largest on record.
Shares of OQGN opened Tuesday at $0.41 (OMR 0.16), up from the offer price of $0.36 (OMR 0.14).
OQ sold about 2.1 billion shares, or 49% of its stake in OQGN. OQ will hold a minimum of 51% stake in the gas firm following the IPO.
OQGN's IPO attracted anchor investors including Fluxys Belgium SA, Saudi Arabia's Public Investment Fund (PIF), and the Qatar Investment Authority. These anchor investors collectively pledged to acquire 30% of the IPO offering.
Bank Muscat SAOG, Bank of America Corp., and EFG Hermes acted as joint global coordinators on the deal.
OQGN reported a profit of $86 million (OMR 33.1 million) in the first half of 2023, up from $60.8 million (OMR 23.4 million) for the same period a year earlier, according to its financial statement.
OQGN expects to pay dividends semi-annually, with a payment of $85.7 million (OMR 33 million) for the first nine months of 2023 in January 2024 and $28.6 million (OMR 11 million) for the fourth quarter of this year by around April 2024.
OQGN is the second IPO in Oman’s privatization program to boost state coffers and expand its stock exchange.
OQ raised $244 million through the IPO of Abraj Energy Services, an oil drilling company, in March. This marked the inaugural step in Oman's privatization program.
Oman follows in the footsteps of the UAE and Saudi Arabia that have raised billions of dollars over the last couple of years, defying a global IPO slump.
The Middle East and North Africa (MENA) region witnessed 13 listings in the second quarter of 2023, a 44% surge compared to the year-ago period, led by Saudi Arabia and the UAE.
