Saudi Arabia’s Al-Sulaiman Group considers IPO of IKEA business – sources

DUBAI: Saudi Arabia’s Al-Suleiman Group is considering an initial public offering of its Ikea business franchise next year and has hired Moelis & Co as an advisor, two sources told Reuters.

The company plans to invite investment banks early next year to pitch a role in a potential public equity sale, sources said.

The deliberations were in the early stages and it was not immediately clear how much the company was looking to sell or raise, the sources said.

Arsulaiman Group did not respond to a request for comment when contacted by Reuters on Wednesday.Moeris declined to comment.

IKEA entered Saudi Arabia in 1983 through the family-owned Arsulaiman Group, which owns and operates franchises of Swedish furniture manufacturers in Saudi Arabia and Bahrain.

Saudi Arabia is encouraging more family-owned companies to go public to deepen its capital markets under reforms aimed at reducing the kingdom’s dependence on oil revenues.

Saudi Arabia has seen a surge in IPOs since it took oil giant Saudi Aramco to a record $29.4 billion listing in 2019.

The Gulf is in the midst of an IPO boom, with issuers raising more than $15 billion in IPOs this year, according to Refinitiv data.

Data showed that IPO earnings in the region outperformed European offerings in the first half of the year, despite global markets remaining volatile due to Russia’s invasion of Ukraine.