Fakeeh Care Group announces cornerstone investment agreements for its IPO

Dr Soliman Abdel Kader Fakeeh Hospital Company (the “Company”), and its subsidiaries hereafter referred to as “Fakeeh Care Group”, “FCG”, or the “Group”, one of Saudi Arabia’s premier integrated providers of high-quality healthcare, trusted by millions of families for more than four decades, announces that it has issued a supplementary prospectus and signed a binding undertaking with each of Olayan Saudi Investment Company and Abu Dhabi Investment Authority (“ADIA”) (together referred to as the “Cornerstone Investors”) for its Initial Public Offering (“IPO” or the “Offering”).

The Cornerstone Investors have committed to subscribe to in aggregate, 3,000,000 Offer Shares at the offer Price (“Cornerstone Commitment”). The Cornerstone Commitment comprises 1,956,522 shares to be subscribed by Olayan Saudi Investment Company, and 1,043,478 shares by ADIA representing approximately 0.84%, and 0.45%, respectively, of the Company’s share capital after the Offering.

The Cornerstone Investors are major investors in Saudi markets, and the Company believes that their contribution will provide an essential drive for achieving growth and long-term strategic goals.

The price range for the Offering was announced earlier and set between SAR 53.0 and SAR 57.5 per share (the “Price Range”), implying a market capitalization of the Company at listing ranging between SAR 12.3 billion (US$ 3.3 billion) and SAR 13.3 billion (US$ 3.6 billion).

The institutional book building subscription period, which commenced earlier today, will close at 5.00PM KSA on 8 May 2024G.

On 31 March 2024G, the Capital Market Authority (the “CMA”) announced its approval of the Company’s application for registering its share capital and the Offering of 49,800,000 Ordinary Shares by way of the issuance of 30,000,000 new Ordinary Shares (the “New Shares”) and the sale of 19,800,000 existing Ordinary Shares (the “Sale Shares”) by the Company’s Selling Shareholders (collectively, the New Shares and the Sale Shares represent the “Offer Shares”). The Offering price will be determined at the end of a book building process.

For more information about the IPO and access the supplementary prospectus, please visit: https://en.fakeeh.care/ipo

Highlights of the Offering

• The Price Range for the Offering has been set between SAR 53.0 and SAR 57.5 per share.
• The total Offering size is expected to be between SAR 2.6 billion (US$ 704 million) and SAR 2.9 billion (US$ 763 million), implying a market capitalization of the Company at listing ranging between SAR 12.3 billion (US$ 3.3 billion) and SAR 13.3 billion (US$ 3.6 billion).
• The Offering comprises an offer of 49,800,000 of ordinary shares, representing 21.47% of the Company’s issued share capital (after the capital increase) through the sale of a mix of existing shares and newly issued shares.
• Following completion of the Offering, the net proceeds of the Sale Shares will be distributed to the Selling Shareholders on a pro-rata basis, based on their respective ownership percentage of the Sale Shares, and the net proceeds of the New Shares will be paid to and used by the Company to finance its growth strategy and for general corporate purposes.
• The Offer Shares will be listed and traded on the Saudi Exchange’s Main Market following the completion of the IPO.

• The Offer Shares will be offered for subscription to individual investors (“Individual Subscribers”) and institutional investors (“Participating Parties”), including Participating Parties outside the United States in accordance with Regulation S under the US Securities Act of 1933G, as amended (the “Securities Act”).

• With respect to the Offering, the Company has appointed:

  • HSBC Saudi Arabia as Sole Financial Advisor, Joint Bookrunner, Underwriter and Lead Manager.
  • anb capital and EFG Hermes KSA as Joint Bookrunners and Underwriters.
  • Alrajhi Bank, Saudi National Bank, Arab National Bank, SAB, Alinma Bank and Bank Aljazira have been appointed as Receiving Agents for retail investors.
  • Moelis & Company Saudi Limited (“Moelis”) has been appointed as Selling Shareholders’ Advisor.

• The Offering is restricted to the following two groups of investors:

  • Tranche (A): Participating Parties – This tranche comprises a number of institutions and companies, including investment funds, qualified foreign investors and GCC investors with legal personality (collectively referred to as the “Participating Parties”) who are entitled to participate in the book building process as specified under the Instructions for Book Building Process and Allocation Method in Initial Public Offerings issued by the CMA. The number of Offer Shares to be initially allocated to the Participating Parties shall be 49,800,000 Offer Shares, representing 100% of the total Offer Shares. In the event of full subscription from Individual Subscribers (known as Tranche (B) below) to the Offer Shares allocated thereto, the Financial Advisor has the right to reduce the number of Offer Shares allocated to Participating Parties to a minimum of 44,820,000 Offer Shares, representing 90% of the total Offer Shares, provided that such reduction shall not apply to the Cornerstone Investors and the final allocation to the Cornerstone Investors shall be 3,000,000 offer shares in all cases. Accordingly, 41,820,000 offer shares will be allocated to the participating parties excluding the offer shares allocated to the cornerstone investors and individual investors. The number and percentage of Offer Shares to be allocated to the Participating Parties by the Financial Advisor in consultation with the Company will be allocated using the discretionary allocation mechanism. It is possible that certain Participating Parties will not be allocated any shares as deemed appropriate by the Company and the Financial Advisor.
  • Tranche (B): Individual Investors – This tranche includes Saudi natural persons, including any Saudi female divorcee or widow with minor children from a marriage to a non-Saudi individual, who is entitled to subscribe to the Offer Shares in the names of her minor children for her own benefit, on the condition that she proves that she is a divorcee or widow and the mother of her minor children, in addition to GCC nationals who have a bank account with one of the Receiving Agents and are entitled to open an investment account. A subscription for shares made by a person in the name of his divorcee shall be deemed invalid and if a transaction of this nature is proved to have occurred, the law shall be enforced against the applicant. If a duplicate subscription is made, the second subscription shall be deemed void and only the first subscription shall be accepted. A maximum of 4,980,000 Offer Shares, representing 10% of the total Offer Shares shall be allocated to Individual Subscribers. If Individual Subscribers do not subscribe for all the Offer Shares allocated thereto, the Financial Advisor may reduce the number of shares allocated thereto in proportion to the number of shares to which they are subscribed.