Flynas IPO oversubscribed by nearly 100 times before trading
The $1.1 billion IPO for Saudi Arabia’s Flynas low-cost airline has reached the runway and is ready for take-off after the offering to institutional investors was nearly 100 times oversubscribed.
The carrier, whose largest shareholders are Prince Alwaleed bin Talal’s Kingdom Holdings and the government’s Public Investment Fund, is the latest in a slew of IPOs for Saudi companies that have also encountered high demand, including Umm Al-Qura construction, which raised more than $500 million in March.
Flynas shares, which will start trading on Riyadh’s Tadawul Stock Exchange May 28, were set on Wednesday at 80 riyals apiece, the top of the range given by the IPO’s investment bankers.
Proceeds from the offering are slated for expanding Flynas’ fleet by 225 planes and launching several new flight hubs. The budget airline flies to 59 destinations and is popular with Muslim pilgrims to Mecca and expat workers from India, the Philippines and elsewhere.
Flynas is not alone among Gulf airlines interested in going public. Abu Dhabi-based Etihad Airways, owned by the ADQ sovereign wealth fund, is actively preparing for an IPO while Emirates and Qatar Airways have been mulling share sales for years.
Still waiting to stretch its wings is Riyadh Air, Saudi Arabia’s new national carrier wholly owned by the PIF, which plans to start flying its stylish royal blue jetliners this year in the fourth quarter.