SAUDI ARABIAN IPO BOOM SPARKS KEY PARTNERSHIP WITH GLOBAL FINTECH FIRM

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A GLOBAL share plan management company, who chose Saudi Arabia as its base for Middle Eastern expansion, has reported a spike in the number of companies in the Kingdom working towards an IPO.

Global Shares – which is headquartered in Ireland but has offices across the US, Europe and Asia – opened its first Middle Eastern office in Riyadh to cater for the increase in demand for its services in the region.

The Saudi IPO market is expected to see increased listings on the Tadawul over the course of 2021, and as a result of this uptick, Global Shares has partnered with the region’s biggest Investment Bank, NCB Capital to offer share plan management services to companies in the region.

The Global Shares platform allows companies to digitize their equity compensation offerings. Global Shares provides a fully outsourced administration service as well as a transactional platform for employees who’ve been given shares by their company.

NCB Capital is Global Shares’ banking partner in the region and the partnership between them and Global Shares means that companies have a fully rounded solution whereby they can trade their shares via NCB Capital.

“There is definitely an increase in the number of companies contacting us who have an IPO on their roadmap, and they want to have a solution in place for this. We are really seeing a large number of Saudi companies adopting this global fintech trend and we’re delighted to be able to help,” Abdulhadi Alherz, Global Shares’ Managing Director for the Middle East said.

He continued: “Going public is a very big deal for companies and there is a lot of preparation that goes into it. We have partnered with companies on their IPOs for many years now on a global setting and we’re delighted to be able to facilitate Saudi companies with the same service now thanks to our partnership with NCB Capital.”

When a company IPOs, employees who have been given shares as part of their compensation packages, often benefit by being able to cash in their equity.

Global Shares – which was founded more than 16 years ago – allows companies to manage their employee share plans online and to carry out all functions of share plan management through the platform.

Global Shares works with some of the biggest enterprise companies in the world and recently launched its Growth Platform, which is used by startups and Series A companies to manage their cap tables and equity plans.

Companies who issue shares to employees can avail of an employee platform, where employees and executives can log in, see the value of their equity and transact their shares. The partnership with NCB Capital allows Global Shares to deliver this service in the Kingdom and help IPO companies be aligned with Saudi Vision 2030.

Mr Alherz said: “An IPO is really exciting for employees and in many cases, it’s what they have been working towards for years. Share plans are used to recruit, reward and retain employees and the IPO is a major milestone in unlocking this.

“Employees can do really well and at Global Shares we have seen some pay off their mortgages, pay off student loans, be able to travel the world, buy their dream car or set themselves up for a very nice retirement. Having a digital platform like Global Shares and through our partnership with NCB Capital means that employees really have visibility and control over their equity.”

Loai Bafaqeeh, Head of Securities Division at NCB said: “We are delighted to work with Global Shares in providing the local infrastructure, Custody, Dealing and related Securities services in compliance with CMA rules for these types of plans. We have seen a significant growth in the usage and interest from local companies in Employee Share Plans and believe this is an important service that aligns with Vision 2030 in growing participation in the capital markets of the kingdom.”

A recent economic report predicted that the Saudi IPO will see 10 listings in 2021. This record increase can be attributed to growth in the banking and petrochemical industries, recovering oil prices and a general sense of optimism around the national economic vision in Saudi Arabia.

General post-pandemic financial recovery and confidence in the region from external investors is also expected to have a positive impact on growth in the region.

A recent report revealed that Saudi Arabia has the most active IPO market in the MENA region in terms of both issuances and proceeds.

Saudi Arabia has been home to a number of regional IPOs in recent years, including the $29.4 billion listing of the state oil giant Saudi Aramco, which at the time became the world’s most valuable publicly-traded company. 

Four Gulf-based companies listed on the Tadawul in 2020, raising a combined $1.45 billion.

About Global Shares:

Global Shares is a leading fintech company and 100% focused on employee ownership. Some of the world’s biggest companies manage their equity compensation programs on the Global Shares platform. With representation in Saudi Arabia and 16 office locations worldwide, Global Shares’ mission is to help companies of all sizes unlock the power of employee share ownership and simplify equity compensation. With support and administration services from a team of 500+ equity experts, businesses can focus on attracting, engaging and retaining key staff. Employees can access to their equity with Global Shares’ award-winning software platform and mobile app.

About NCB Capital:

NCB Capital is the Securities, Asset Management and Investment Banking arm of Saudi National Bank (Tadawul Code: 1180), the Kingdom of Saudi Arabia’s largest commercial bank.  NCB Capital provides Securities Brokerage & Services, Asset Management and Investment Banking services to: (i) local retail, affluent and High Net Worth clients, as well as (ii) local, regional and international institutional clients.  NCB Capital’s market leadership is evidenced by its leading position as Saudi Arabia’s largest custodian of securities on Tadawul and the Kingdom’s largest asset manager with SAR 168 billion in assets under management as of 31 July 2020.  NCB Capital is licensed and authorized by the Capital Market Authority to provide the following services: Dealing as Principal and Agent, Custody, Underwriting, Managing, Arranging and Advising with respect to securities.