EFG Hermes announced Monday that it concluded advisory on the SAR 1.4bn ($378m) IPO of Saudi power cables manufacturer Riyadh Cables Group Company (RCGC) on the Saudi Stock Exchange (Tadawul). EFG Hermes acted as joint bookrunner on the transaction.
The listing saw RCGC offer 33,000,000 ordinary shares, representing 22% of its share capital, at a price of SAR 43.00/share, implying a total market capitalization of SAR 6.45bn. The transaction garnered significant traction from regional and global investors, having been 72x oversubscribed on the institutional tranche. Trading on the company’s shares commenced today, with RCGC listed under the ticker 4142.
Saud Altassan, CEO of EFG Hermes KSA, commented on the transaction: “As the Saudi equity market continues to ramp up, we’ve made it a priority to focus on bringing to market unique transactions that provide unmatched returns, a testament to our standing as a gateway through which regional and global investors can access quality issuances. 2022 has been a year of remarkable achievements for EFG Hermes, having capitalized on our unrivalled capabilities, deep-rooted industry know-how, and the rock-solid foundation of trust we’ve built with clients to advise on the region’s most notable transactions. We look forward to building on these milestones to grow our Saudi business in the year ahead.”
RCGC’s track record of over four decades, paired with its ironclad operational model and expansive geographical presence, has enabled the company to become an integral part of the energy and communications landscape. Established in 1984, RCGC is the leading power cable manufacturer in Saudi Arabia and MENA, and one of the largest in the world, with a total production capacity of some 264,000 tons. Boasting 15 production facilities across Saudi Arabia, UAE, and Iraq, and anchored by a team of renowned engineers and technicians, the company manufactures a wide range of premium cable and wire offerings, with a focus on the generation, transmission and distribution, oil and gas, transportation, industrial, and telecommunications sectors. Alongside its manufacturing capacities, the company exports its products to over 37 global markets spanning five continents.
Mohamed Abou Samra, Managing Director at the Investment Banking division, EFG Hermes, also commented: “We are thrilled to have worked on this landmark IPO and to be supporting a national industrial pioneer such as RCGC. The deal ideally positions the company to carry out its expansion and scaling plans, which are becoming important now more than ever as the company gears up to support Saudi Arabia’s 2030 Vision directives in energy transition and developmental projects. As the kingdom continues to enjoy strong macroeconomic tailwinds that have attracted foreign capital and allowed the market to buck the global downturn in ECM activity, RCGC’s IPO was met with strong investor interest from both retail and institutional investors looking to capitalize on the company’s consistent profitability and growth prospects.”