Third disappointing listing
Offering was delayed
The share price of Specialized Medical Company (SMC) has fallen in its first hour of trading on the Saudi Exchange.
It is the third company in a row to suffer losses immediately after listing on the main market.
Shares in the hospital operator opened at SAR24.50 ($6.53), 2 percent below its final offer price of SAR25. As of midday local time on Wednesday, it had bounced back slightly to SAR24.78.
SMC has concluded an IPO which raised SAR1.9 billion ($500 million) and brought the total raised by IPOs on the main market so far this year to $2.8 billion.
The offering, which saw SMC float 30 percent of its post-IPO share capital, was delayed and its prospectus re-released after the company clawed back SAR200 million of dividends “in line with guidance received from the regulators”, the company said in an investment update.
It follows two disappointing listings on the Saudi exchange, those of budget airline Flynas and packaging company United Carton Industries Co. The share prices of both fell on the first day of trading.
The market has suffered from shocks this year following the US announcement of widespread trade tariffs in April followed by the outbreak of hostilities between Israel and Iran. As of Wednesday, four of the five Saudi IPOs completed this year were trading below their initial offer price.
SMC is currently building three new hospitals in Riyadh which should break even within three to four years, the Saudi company’s chief executive Bassam Chahine told AGBI in January.
The three hospitals will more than double SMC’s total bed count to about 1,200.
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