Mesaieed Petrochemical’s QR3.5bn Qatar IPO fully subscribed

By Aamir Ashraf

DUBAI (ICIS)–Mesaieed Petrochemical Holding has successfully raised Qatari riyals (QR) 3.2bn  ($880m) from its initial public offering (IPO), Qatar’s first in three years, industry and government officials said on Monday.

The company, which is a unit of state-owned Qatar Petroleum (QP), had offered 323.2m shares, equivalent to a 25.7% stake, at QR10.2 each.

The IPO, which began on 31 December 2013 and closed on 21 January 2014, is part of QP’s 10-year savings and investment program.

The offer was open only to Qatari nationals and industry officials said the IPO was heavily subscribed.

“It has been oversubscribed by multiple times despite confusion over whether it was halal [permissible] in Islam or haram [forbidden] to apply for subscription to IPO,” a Dubai-based banker at said.

Many local lenders such as Doha Bank, Qatar Islamic Bank and Al Khaliji  had extended 100% financing to IPO buyers.Qatar Petroleum is set to announce the buyers of the Mesaieed Petrochemical shares under the IPO on 30 January. The shares will then be admitted to trading on the Qatar Exchange in February.

In a statement issued last week, Qatar Energy and Industry minister Mohamed bin Saleh al-Sada had said that the IPO’s success demonstrates investors’ confidence in the petrochemical firm, as well as the attractiveness of the innovative long-term savings program that the government has put in place.

“The successful IPO has provided so many Qatari nationals with an opportunity to become shareholders in Mesaieed and to participate in the success of the country’s petrochemicals sector,” al-Sada, who is also the chairman of QP, said.

Mesaieed holds major stakes in three petrochemical firms – Qatar Chemical Co Ltd (Q-Chem 1), Qatar Chemical Co II Ltd (Q-Chem II) and Qatar Vinyl Co.

It further holds stakes in ventures that manufacture polyethylene, caustic soda and other chemical products.  

In 2012, the stakes held by Mesaieed generated a combined revenue of QR4.3bn and a net profit of QR1.6bn.

The global financial crisis of 2008 froze IPOs in Qatar — the world’s top exporter of liquefied natural gas (LNG). However, the government wants to revive the market and has planned to conduct IPOs worth QR50bn over the next 10 years, bankers and government officials said.

($1 = QR3.64)