Individual Investor Subscription to STC’s Solutions by, Kicked off

Individuals can buy 2.4 million shares in the Arab Company for Internet and Communications Services, best widely known, in short, as the “Solutions by STC” for SR151 as of today.

Thus, ushering in, the fourth IPO, in the financial market, in 2021.

Last year, just three firms have gone public.

Individual investor’s subscription periodhas begun on  Sunday, September 19, 2021, and will last three days, including the subscription ending day, September 21.

Individual investor can submit subscription application for the offfer shares, at particular receiving entities’ branches, or via the Internet, phone banking, or ATMs of the receiving entities, namely: SABB Bank, Saudi National Bank, Al Rajhi Bank, Riyad Bank, and Alinma Bank, Al-Bilad Bank.

Individual investor include Saudi citizens as well as any non-Saudi citizen resident or the GCC member states natural persons who have bank account with one of the receiving entities, and are eligible to open an investment account.

Timetable for offering

With a market share of 13% in the Kingdom’s information technology services market, “Solutions by STC” is the leading company in the field. In most market segments of the business sector, in  the Kingdom’s ICT market, it is among the top three businesses.

The company’s activities include communications wire extensions, network extensions, computer and communications network installation and extension, security device installation and maintenance, and senior management consultant services.

Working as well, in the fields of information technology and communications building and other service activities, are also included in its core framework.

According to the company’s prospectus, it focuses primarily on systems integration, managed services, connectivity and digital services.

In addition, the company has ongoing initiatives and future goals to expand its business volume.

This is to ensure that it strengthens its position in the market for managed and professional services and outsources business operations, while also boosting its competitive position in the market by expanding its relationships with customers along the information technology value chain.

It can leverage its substantial market presence, as well as its strong reputation within the Kingdom.

It was accomplished by attracting different types of clients and having a presence in across the Kingdom.

The company may also draw on a huge institutional basis of knowledge and access to consumers and infrastructure, thanks to its strong partnership with the Saudi Telecom Company (STC).

The IT services market in the Kingdom is highly segmented, which explains why there are so many tiny businesses.

As it competes with local integrated service providers, multinational companies and powerful telecommunications corporations such as Advanced Electronics Company, SBM, and Ejada, “solutions by STC” has the greatest market share, at 13%, and it is among the top three companies in most market segments.

The subscription proceeds total is estimated at SR3,624 million, and the company stated in its prospectus that the proceeds shall be returned to the selling shareholders, in full (after deducting all charges and costs related to the offering, estimated at SR47.54 million, to the selling shareholders, namely the Saudi Telecom Company, and Etisalat Commercial Incorporation.

STC owns the entire company. That is, the subscription proceeds will all go to the Saudi Telecom Company, either directly or indirectly.

The stockholding percentage of the telecommunications company, will decrease after the subscription to 79% of “Solutions by STC”.

The major shareholder, the number of his shares and the percentage of his stake, before and after the offering

Based on the figures mentioned in the company’s financial statements, Solutions by STC’s revenues increased by 31.1%. Gross profit increased by 67.8%.

The net profit for the year increased by 78.2% during the year 2020.

The company achieved a net profit of SR461.3 million in the first half of 2021, an increase of 19% compared to profits of SR388.1 million, in the first half of 2020. Revenues in the first half of 2021 amounted to SR3.8 billion, compared to SR3.2 billion in the same period of 2020, an increase of 19%.

For the fiscal years ending December 31, 2018, 2019, and 2020, a consolidated statement of profit and loss and other comprehensive income was prepared.

Source: Consolidated audited financial statements, excluding percentages, for the Years 2018, 2019 and 2020.