Arabian Mills to float 30% of its stake on Saudi bourse

Unsplash.com/Immo Wegmann

Arabian Mills for Food Products Company (Arabian Mills) will sell 15.4 million shares, or 30 percent of its share capital, on the Saudi stock exchange.

The sale comprises existing shares by Abdulaziz Al-Ajlan Sons for Trading and Real Estate Investment Company (Ajlan & Bros), Sulaiman Abdulaziz Al-Rajhi International Company, and National Agricultural Development Company (NADEC).

Following the IPO completion, the current shareholders will collectively own 70 percent of the share capital and a controlling interest in the flour producer.

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The offer price will be determined through a book-building process, which is expected to be completed on September 11.

The retail subscription will run from September 18 to 19. The final share allocation date is September 26. The listing will take place on the main market. No date for listing has been set.

The Capital Market Authority, the country’s market regulator, approved the IPO in June.

Arabian Mills, which was earlier known as Second Milling Company (MC2), was sold for SAR2.1 billion ($568 million) in 2021 by the Saudi Grains Organization as part of the country’s privatisation drive.

“The decision to go public will accelerate our growth trajectory,” said Arabian Mills CEO Rohit Chugh.

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The growing market for flour, feed and bran in the kingdom presents compelling opportunities, he added.

Arabian Mills reported revenues and net profit of SAR862 million and SAR200 million, respectively, in 2023.  

The company has three facilities – one each in Riyadh, Hail and Jazan – with 25 packaging lines, 80 silos and 10 handling and delivery lines.

The company’s daily flour production capacity stands at 4,920 tonnes and a daily feed milling capacity of 600 tonnes.

HSBC Saudi Arabia has been appointed the financial advisor, global coordinator, bookrunner, underwriter and lead manager.

Al Rajhi Bank, Saudi Awwal Bank and Banque Saudi Fransi will work as receiving agents for retail investors.