Muscat: As many as five Omani companies, including three state-owned, are expected to float initial public offerings (IPO) on the local bourse this year.
These firms include Mining Development Oman (MDO), Falcon Insurance and three other state-owned firms, Abdullah bin Salem al Salmi, executive president of Capital Market Authority (CMA), told ‘Times of Oman’.
He said the minister responsible for financial affairs had recently mentioned about plans to divest stakes in three government companies. This is part of a major privatization programme, which was planned few years ago, in a move to raise resources for the government
Four state-owned agencies — the State General Reserve Fund (SGRF), the Oman Investment Fund (OIF), the Oman Oil Company and Oman National Investments Development Company (Tanmia) — have jointly promoted the Mining Development Oman, which will have a capital of OMR100 million. Of this, OMR60 million will be contributed by the promoters and the remaining OMR40 million will be raised from investing public through an initial public offering in the second quarter of this year.
Also, Falcon Insurance, a subsidiary of Al Anwar Holding, last year said that it plans to float an initial public offering on the Muscat Securities Market (MSM).
The Sultanate’s insurance regulator, Capital Market Authority, in 2014 asked national insurance companies to go public within three years (in line with an amendment in the Insurance Companies Law) and that is one of the reasons for Falcon’s proposed share offer.
As many as eight locally-incorporated insurance companies, including a reinsurance firm, will offer shares to investing public within the next couple of years to comply with the amendments in the insurance law.
Apart from Falcon, the national insurance firms that are expected to float shares on the local bourse are Al Ahlia Insurance Company, Muscat Insurance, Muscat Life Insurance, and National Life Insurance, in addition to Oman & Qatar Insurance and Vision Insurance.
Further, the Sultanate’s only reinsurance firm - Oman Reinsurance Company - will issue shares to the investing public.
Al Salmi said that the performance of the corporate sector is still good.
Referring to the recent decision to amend a law allowing brokerage firms to sell shares of defaulting clients, he said “this will give more trust in the market. The brokers will be able to sell shares in case the client does not pay within the settlement period. Earlier, brokerage firms had to go to court for selling shares of defaulting clients.”