Oman: OQEP's Initial Public Offering Set To Raise $2 Billion On September 30

Oman's government-owned oil and gas company, OQ Exploration and Production (OQEP), has declared the initiation of its initial public offering (IPO) subscription phase on September 30, setting the stage for a significant financial event, according to Muscat Daily reports.

The IPO, which aims to garner up to RO780mn ($2.026bn), will see a quarter of OQEP's shares, totaling 2,000,000,000 shares, available for purchase. This move not only highlights OQEP's substantial valuation, potentially reaching RO3.120bn ($8.104bn), but also marks a pivotal moment in Oman's financial landscape.

Labelled as the most substantial IPO in Oman's history, OQEP's market entry signifies a landmark event, especially within the exploration and production sector. This IPO follows the footsteps of Abraj Energy Services and OQ Gas Networks in their successful market listings. Ashraf Hamed al Mamari, Group CEO of OQ, emphasized the monumental nature of this IPO, stating, "the OQEP's initial public offering marks the largest IPO in Oman's history and the first of its kind in the exploration and production sector."

Ahmed al Azkawi, CEO of OQEP, shared his enthusiasm about the IPO, highlighting the opportunity it presents to the public to invest in a leading entity in Oman's oil and gas sector. "Through the publication of the prospectus, we offer the public a rare opportunity to invest in a leading Omani oil and gas explorer and producer in what is set to become the largest IPO in the country's history. We are also extremely pleased to have a strong compilation of reputed Omani institutions as Anchor investors. We also highlight our commitment to transparency, sustainable practices and our continued endeavour to maximise shareholder value."

OQEP has outlined a subscription strategy approved by the Financial Services Authority (FSA), featuring a parallel offering that includes institutional and retail investors. Institutional investors will have access to 40% of the shares, while another 40% will be available to retail investors in Oman, and 20% have been allocated to Anchor investors.

The subscription price for institutional offers ranges between 370bz and 390bz per share, with a 10% discount applied to the final subscription price for Omani retail investors, setting their maximum price at 351bz per share.

The IPO has attracted significant interest from six Anchor investors, including Al-Hosn Investment Company, BankDhofar, and others, who have collectively committed to a 20% share purchase. These investors will subscribe at the final price, not exceeding 390bz per share, demonstrating strong institutional support for OQEP's market debut.

OQEP also announced a generous dividend distribution plan post-IPO, aiming to distribute virtually all its distributable free cash flow to shareholders. The company plans to make its first dividend payment of approximately RO57.7mn ($150mn) in December 2024 for Q3 2024, followed by a similar distribution for Q4 2024 in March 2025. This strategy underlines OQEP's robust cashflow generation capabilities and its commitment to rewarding investors.

The IPO's subscription window opens on September 30, with institutional offers closing on October 10 and retail offers on October 9. OQEP shares are slated to begin trading on the Muscat Stock Exchange by October 28, under the symbol 'OQEP’.