Saudi Airline flynas Ambitiously Prices IPO After $109B in Orders
Saudi Arabia’s budget airline flynas, backed by Prince Alwaleed bin Talal’s Kingdom Holding, has priced its initial public offering (IPO) at SAR 80 per share, the top of its indicative range, attracting a staggering SAR 409 billion ($109 billion) in institutional orders—nearly 100 times oversubscribed.
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Key Details
IPO Pricing and Valuation
- Share Price: Priced at SAR 80 per share, implying a market capitalization of SAR 13.7 billion ($3.6 billion).
- Funds Raised: The IPO is expected to raise SAR 4.1 billion ($1.1 billion).
Market Demand
- The institutional tranche was nearly 100 times oversubscribed, reflecting strong local and international demand. Retail orders are still pending, suggesting the final book could be even larger.
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Significant Milestone
- This marks the first Gulf airline IPO in nearly 20 years, a major milestone for the region’s aviation sector. The IPO will include 51.26 million shares, representing 30% of the airline’s share capital, comprised of new shares and stock from existing investors.
Planned Use of Proceeds
- Fleet Expansion: A significant portion of the funds will support fleet growth and the establishment of additional operational hubs.
- Employee Incentives: Approximately 66% of the proceeds will go towards employee incentive programs and payouts to selling shareholders.
Financial Performance
In 2024, flynas reported:
- Revenue: $2 billion
- Net Profit: $116 million
This performance illustrates robust demand for budget travel and expanding route offerings.
Strong Backing and Advisors
The IPO is led by major financial institutions including:
- BSF Capital
- Goldman Sachs Saudi Arabia
- Morgan Stanley Saudi Arabia
Other notable joint bookrunners include Al Rajhi Capital, ANB Capital, Citigroup, and Emirates NBD Capital.
Investor Confidence
The successful bookbuilding process and high market interest underscore growing investor confidence in Saudi Arabia’s Vision 2030 strategy and the strength of its capital markets.
Despite market volatility, flynas is among the few regional firms moving forward with IPOs, alongside other companies like United Carton Industries and Specialized Medical Co.
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