Kuwait’s Stock Exchange IPO Will Be Oversubscribed, CEO Says
Kuwait’s Stock Exchange IPO Will Be Oversubscribed, CEO Says
(Bloomberg) -- The Kuwait stock exchange’s initial public offering is progressing well and will close next month oversubscribed, the bourse’s chief executive officer said.
“I’m 100% sure it will be covered many times,” Mohammad Al Osaimi, the CEO of Boursa Kuwait, said in an interview with Bloomberg Television in Dubai.
The sale of half the exchange to local citizens began last month and will end Dec. 1, with the offering price set at 100 fils per share, or one-tenth of a dinar. The IPO follows a 44% sale earlier this year to a consortium of domestic and international investors.
Last month, Kuwait’s highest religious authority said the offering breached Islamic law’s prohibition on interest and branded it “haram,” or forbidden. According to the authority, that’s because Boursa Kuwait facilitates trades in some companies that don’t comply with Islamic principals.
Al Osaimi said local legislation doesn’t state the bourse must be Shariah-compliant, and that the exchange operates with normal practices seen in other markets. He expects the stock to start trading “around June.”
The exchange has made all the changes necessary for index compiler MSCI Inc. to upgrade it to emerging-market status in June, as required by the New York-based company earlier this year, he said. That should lead to as much as $3 billion in passive inflows to the country, he estimated.
The main equities index in Kuwait rose 0.1% as of 9:32 a.m. local time, extending its increase this year to 17%, the most among major gauges in the Middle East, North Africa. That’s also more than benchmarks tracking frontier and emerging markets.
--With assistance from Zainab Fattah and Fiona MacDonald.
To contact the reporters on this story: Filipe Pacheco in Dubai at fpacheco4@bloomberg.net;Yousef Gamal El-Din in Dubai at ygamaleldin@bloomberg.net;Tracy Alloway in Abu Dhabi at talloway@bloomberg.net
To contact the editors responsible for this story: Celeste Perri at cperri@bloomberg.net, Paul Wallace, John Viljoen
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