Shares of regional oil and gas giant ADES Holding leapt 30% in their first day of trading on the Tadawul yesterday, closing the day at SAR 17.54. The IPO of the Public Investment Fund-backed company had been heavily oversubscribed, with the institutional tranche seeing nearly 10x more demand than there were shares on offer.

Who sold: Shareholders including PIF, ADES Investments Holdings, and Zamil Group Investment together sold a total of 101.6 mn existing shares, and ADES issued 237.1 mn new shares as part of the transaction, according to Reuters.

Where’s the money going? ADES intends to use the proceeds from the offering to pay down debt, fund its growth strategy, as well as for “general corporate purposes,” Bloomberg reports.

Advisors: Our friends at EFG Hermes acted as joint financial advisor, global coordinator, bookrunner, and underwriter on the offering, according to an EFG Hermes press release (pdf) released yesterday.

Ades started life here in Egypt, where it maintains a significant presence. It derived 18% of its revenue locally in 2019 (ahead of a sustained push to expand its regional operations), according to a 2020 investor presentation (pdf). It is currently the country’s largest offshore driller. The company has also been reported as saying it could look into a dual listing on the Egyptian Exchange after its Saudi debut.

Another rate hike in the Fed’s future? Most Federal Reserve officials see “one more increase in the target federal funds rate at a future meeting” as appropriate, according to the meeting minutes (pdf) released yesterday. Members of the Fed Open Market Committee agreed to “proceed carefully” on future decisions and base their decisions on incoming information and its implications. The bank left interest rates unchanged during its September meeting, but hinted that policy will remain tight to fight soaring inflation and bring it down to the target 2%.

ALSO WORTH NOTING-

  • Arab Bank becomes first Jordanian lender to sell sustainable AT1 bonds:Amman-based Arab Bank has closed a USD 250 mn issuance of sustainable Additional Tier 1 (AT1) bonds, becoming the first lender in the country to sell the contingent-convertible bonds. The London-listed bonds were sold at an 8% interest rate, and attracted strong demand from investors. (Arab Bankstatement, pdf)
  • Exxon on the verge of one of the year’s biggest acquisitions: US oil giant Exxon Mobil is close to finalizing an agreement to buy US shale producer Pioneer Natural Resources for nearly USD 58 bn in an all-stock deal. The acquisition would be Exxon’s largest since its USD 81 bn takeover of Mobil in 1998, and the second-largest this year behind Broadcom’s USD 69 bn purchase of VMware. (Bloomberg)

EGX30

19,653

-0.4% (YTD: +34.6%)

USD (CBE)

Buy 30.83

Sell 30.95

USD at CIB

Buy 30.85

Sell 30.95

Interest rates CBE

19.25% deposit

20.25% lending

Tadawul

10,573

-0.6% (YTD: +0.9%)

ADX

9,647

+0.4% (YTD: -5.5%)

DFM

4,082

+0.8% (YTD: +22.4%)

S&P 500

4,377

+0.4% (YTD: +14.0%)

FTSE 100

7,620

-0.1% (YTD: +2.3%)

Euro Stoxx 50

4,201

-0.1% (YTD: +10.8%)

Brent crude

USD 85.67

-2.3%

Natural gas (Nymex)

USD 3.39

+0.4%

Gold

USD 1,887.40

+0.7%

BTC

USD 26,705

-2.6% (YTD: +61.7%)

THE CLOSING BELL-

The EGX30 fell 0.4% at yesterday’s close on turnover of EGP 2.1 bn (3.3% below the 90-day average). Regional investors were net buyers. The index is up 34.6% YTD.

In the green: Ezz Steel (+8.7%), B Investments Holding (+8.0%) and Mopco (+3.9%).

In the red: Alexandria Mineral Oils Company (-3.7%), Belton Financial Holding (-3.1%) and Orascom Development Egypt (-2.5%).

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