(Bloomberg) -- OQ Base Industries fell in its trading debut after a $489 million initial public offering in Muscat, the latest in a series of Middle Eastern listings to experience poor early trading.
Shares in the methanol and liquefied petroleum gas firm declined as much as 10% on Sunday. That was below the offer price of 111 baisas ($0.29) apiece, which was at the top of a marketed range.
The sultanate’s state energy firm OQ SAOC sold a 49% stake in the unit at a price that implied a valuation of $1 billion.
It follows a string of disappointing trading debuts in the Middle East. Talabat’s $2 billion IPO, the region’s largest this year, closed 7% lower on the day of its Dubai listing, and shares in Lulu Retail ended the day flat after its $1.7 billion Abu Dhabi listing.
OQ’s $2 billion IPO of its exploration and production unit in October also saw a muted debut. Oman is in the midst of an ambitious privatization drive, with around 30 assets in the pipeline.
Other upcoming offerings include logistics company Asyad and Oman Electricity Transmission Co. OQ is also considering listing more of its units over the next couple of years.
OQ Base Industries’ IPO got aggregate demand for 387 million rials from institutional and retail investors. Falcon Investments LLC, Gulf Investment Corp., Saudi Omani Investment Co. and Social Protection Fund, had committed to subscribe for about 30% of the offer as anchor investors.
The firm plans to pay about $85 million in dividends for 2024. For 2025 and 2026, the payout will be at least 5% higher than the previous year.
It reported revenue of $510 million and an adjusted EBITDA margin of 43.1% for the year ended December 2023.
Morgan Stanley, Bank Dhofar and Bank Muscat were joint global coordinators on the OQ BI offering, while Kamco Investment Co. and BSF Capital were appointed as joint bookrunners.
--With assistance from Omar Tamo.
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