Saudi Arabia is delaying the IPO of the Tadawul, the Kingdom’s stock exchange, “on hopes that a potential MSCI Inc. upgrade could boost its value,” according to Bloomberg which cited people with knowledge of the matter.
The Tadawul has pushed back plans to sell shares “to 2019 at the earliest,” according to Bloomberg, because waiting until after MSCI’s possible classification as an emerging market in June “could improve trading volumes and help the bourse achieve a better valuation for its owner, the Public Investment Fund.”
The little-known IPO plans for Saudi Arabia’s stock market have been overshadowed by talk of a potential IPO by Saudi Aramco, the state oil company of the Kingdom. Those plans have been repeatedly delayed as difficulties of finding a suitable international venue and a tumultuous oil market make achieving the hoped-for valuation for the world’s largest company a challenge.
As Bloomberg reports, the Tadawul is among the world’s top 10 best performers this year after FTSE Russell classified the country as a secondary emerging market in March.