Legal advisors, Abdulaziz Alajlan & Partners alongside Baker McKenzie, London, have advised the syndicate of 11 underwriting banks on International Company for Power and Water Projects' ("ACWA Power's") US$ 1.2 billion initial public offering and listing on the Saudi Stock Exchange (Tadawul), with an implied market capitalization on listing of approximately US$ 11 billion. The syndicate included Citigroup, J.P. Morgan, Natixis and Riyad Capital as joint coordinators, financial advisors, bookrunners and underwriters. The syndicate further comprised EFG Hermes, Emirates NBD and FAB Capital as joint bookrunners and underwriters, as well as Albilad Capital, Alistithmar Capital, Aljazira Capital and SNB Capital as underwriters. ACWA Power formally announced the IPO on 2 September 2021 and trading in its shares commenced today.
Founded in 2004, ACWA Power is a leading private developer, owner and operator of long-term contracted power generation and desalinated water projects worldwide. ACWA Power today has 64 projects in operation, construction or advanced development in 13 countries across three continents, with a total project cost of SAR 248 billion (US$ 66 billion).
The IPO was marketed to institutional investors both domestically and internationally pursuant to "Regulation S" and comprised the issue of 81.2 million new shares, representing approximately 11% of ACWA Power's existing share capital. The final offer price per share was set at US$ 14.9 (SAR 56), which was at the top end of the price range, having attracted high demand from Saudi and international institutions as well as the investing public in the Kingdom. With an intention to use the net proceeds from the offering to further support upcoming projects, the total proceeds raised by ACWA Power were US$ 1.2 billion, making it the largest IPO in the Kingdom of Saudi Arabia since Saudi Aramco's IPO in 2019.
Commenting on the deal, Karim Nassar said “We are very pleased to have had the opportunity to act for the syndicate of underwriting banks on this pre-eminent IPO transaction, which highlights the depth and breadth of our capacity and capability involving our equity capital markets teams across two of our EMEA offices. This IPO will provide ACWA Power with the needed funding to support its growth strategy. It is a manifestation of the continuing strong demand for IPOs from domestic and international investors in the Kingdom.”
George Marshall added, “It was a great honour for Baker McKenzie to be entrusted with such a significant transaction. Advising on this deal enabled us to draw on our deep knowledge and experience in assisting not only investment banks but major industry players in such prominent fund-raising deals. Building on our recent experience of advising on international deals from the Kingdom, we are very pleased to see that the deal has come to fruition through a successful Tadawul listing and international offering.”
The cross-border team was led by George Marshall and Adam Farlow (Partners, Baker McKenzie, London) and Robert Eastwood and Karim Nassar (Legal Advisors, Riyadh). Further support was provided by Charles Farnsworth (Of Counsel) and Matthew Caulfield (Associate) of Baker McKenzie, London, and Lama AlHabib (Trainee Associate) of Legal Advisors, Riyadh.
This is the latest example of a high profile, international capital markets transaction that Legal Advisors and Baker McKenzie have advised on in Saudi Arabia. In 2020, the Firm advised Saudi Arabian supermarket giant, BinDawood Holding Company, on its US$ 585 million IPO, which is shortlisted for a number of industry awards including "Equity Deal of the Year" at the IFLR Middle East Awards, 2021. This followed the Firm advising on Arabian Centres' ground-breaking IPO in 2019, which set the blueprint for international equity deals from the Kingdom and won a number of awards for the Firm, including "Equity Deal of the Year" (IFLR Middle East Awards, 2019).