Middle East Healthcare IPO approved by CMA

31/12/2015 05:30 AST

Saudi Arabia's Capital Market Authority (CMA) said on Wednesday it had approved a stock exchange flotation for Middle East Healthcare Company, Reuters reports Middle East Healthcare Co. will offer 30 percent of itself in its initial share sale, equivalent to 27.6 million shares, which will be marketed to institutional investors and then to the public. The latter phase will run between Feb. 3 and 9, according to a statement posted on the bourse.

The statement did not provide any details on the company. The price of the share sale will be set using a book-build process, where the price of shares is determined using feedback from investors instead of fixing a price at the beginning of the offering, the agency said.

According to a report on Tadawul website, the CMA board has approved Middle East Healthcare Company's IPO of 27,612,000 shares representing 30 percent of the company’s share capital.

A portion of the offered shares will be allocated to institutional investors. The company's shares will be offered during the period from Feb. 3 to 9, 2016, once the book-building process is complete.

The company’s prospectus will be published within sufficient time prior to the start of the subscription period. The prospectus has to include all relevant information that the investor needs to know before making an investment decision, including the share price, and company's financial statements, activities and management.

A subscription decision without reading the prospectus carefully or fully reviewing its content may involve high risk. Therefore, investors should carefully read the prospectus, which includes detailed information on the company, the offering and risk factors.

This thus provides potential investors the ability to evaluate the viability of investing in the offering, taking into consideration the associated risks. If the prospectus proves difficult to understand, it is recommended that an authorized financial adviser be consulted prior to making any investment decision.

However, the CMA’s board approval of the offer should never be considered as a recommendation to subscribe in the offering of any specific company.

The board's approval of the offer merely means that the legal requirements as per the Capital Market Law and its Implementing Regulations have been met.

Arab News