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(Bloomberg) — Oman’s state energy company OQ SAOC unveiled plans for an initial public offering of its methanol and liquefied petroleum gas unit, extending the boom of news share sales in the Middle East.
The firm will sell up to 49% in OQ Base Industries SOAG, according to a statement. The business is expected to be valued between $1 billion and $1.5 billion, Bloomberg News has previously reported.
The deal would come shortly after OQ raised a record $2 billion from an IPO of its exploration and production business. OQ Exploration & Production’s shares declined in its debut last week, a rarity in the region, and are trading below the offer price. Analysts attributed the drop to a slump in crude prices on the day, though oil has since ticked up after OPEC+ pushed back production cuts.
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The OQEP offer saw aggregate demand of $5.4 billion that indicated continued interest in Gulf deals despite escalating violence in the wider region. Still, it was lower than the $10.4 billion worth of orders for OQ Gas Networks SAOG’s $748.6-million IPO last year.
The Middle East has seen a flurry of listings this year that have raised around $8 billion. Oman too is in the midst of an ambitious privatization drive with around 30 assets in the pipeline, including logistics company Asyad Group and Oman Electricity Transmission Co.
The offer period for OQ Base Industries’ IPO will start in November and its shares will begin trading on the Muscat Stock Exchange in December. “The intended listing would provide investors with the opportunity to invest in Oman’s only production company of methanol, ammonia, and LPG products,” it said in a statement Monday.
The firm reported revenue of $510 million and an adjusted EBITDA margin of 43.1% for the year ended December 2023. It expects to pay a dividend of about 24.5 million rials ($63.6 million) for the first nine months of 2024 by January and a second tranche of about 8.2 million rials by April.
Morgan Stanley, Bank Dhofar and Bank Muscat have been named joint global coordinators, while Kamco Investment Co. and BSF Capital have been appointed as joint bookrunners.
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