Saudi airline flynas' IPO oversubscribed by nearly 350%

Arab News

2 days ago

RIYADH: Saudi low-cost carrier flynas finalized its initial public offering share allocation at SR80 ($21) per share, the top of its indicated range, following robust demand from institutional and retail investors.
The pricing values the airline at an estimated market capitalization of SR13.6 billion at listing.
The offering comes after flynas announced plans last month to float 30 percent of its share capital on the Saudi Exchange, becoming the first airline in the Kingdom to go public and the Gulf's first in nearly two decades.
Between May 28 and June 1, 666,069 retail investors oversubscribed the offering by nearly 350 percent, receiving 10.25 million shares, or 20 percent of the total. Institutional investors showed even stronger appetite, oversubscribing their tranche by roughly 100 times, with orders totaling SR409 billion from both local and international buyers.
In a press release, flynas stated: 'Each retail investor was allocated a minimum of 10 shares, with the remaining shares allocated on a pro-rata basis in proportion to the size of demand, resulting in an average allocation factor of 12.3 percent.'
It added: 'Any surplus subscription funds will be refunded to retail investors no later than Thursday, 5 June 2025.'
The company's shares are expected to list and begin trading on the Main Market of the Saudi Exchange once regulatory requirements are met with the Capital Market Authority and the exchange. The exact listing date will be announced in due course.
The IPO marks a key milestone for the company as it seeks to strengthen its market position and expand its operational footprint.
'This strategic move will propel us toward becoming the leading low-cost carrier in the MENA region for short and medium-haul markets by 2030,' Bander Al-Mohanna, CEO and managing director of flynas, said last month.
He added: 'Through this IPO, we are offering investors access to a unique and valuable asset in the rapidly growing KSA and GCC aviation sector.'
The strong interest from both retail and institutional investors reflects rising confidence in the Kingdom's aviation sector and its broader economic diversification efforts.
Launched in 2007, the airline holds a 23 percent share of Saudi Arabia's domestic aviation market and operates one of the youngest fleets in the region, with an average aircraft age of 3.2 years. The airline reported an 88 percent on-time performance rate in 2024.
Proceeds from the IPO will be used to expand its fleet — including a major order for 225 Airbus aircraft — enhance services for Hajj and Umrah travelers, and invest in cargo operations.
The strong capacity growth of flynas aligns with Saudi Arabia's national goal to establish itself as a global tourist and business destination. The Kingdom aims to attract over 150 million visitors by the end of this decade.