Kuwait’s Capital Markets Authority (CMA), the regulatory body for securities and current owner of 50 per cent of Kuwait’s only stock exchange, Boursa Kuwait Securities Company (BKSC), will launch tomorrow (October 1) the public offering of its full stake in BKSC.
Upon conclusion of the public offering, 94 per cent of Boursa Kuwait will be owned by private investors (corporate and individual investors), making it the only stock exchange in the Gulf that is 94 per cent owned by the private sector.
The transaction, led and managed by Kamco Investment Company, is the second and final phase of the privatization process of Boursa Kuwait following the sale of 44 per cent of the company to strategic investors in February 2019.
Public offering highlights:
• Subscription period: October 1, 2019 to December 1, 2019.
• Eligibility: By law, CMA’s 50 per cent stake in BKSC is offered only to Kuwaiti citizens.
• Offering price: 100 fils per share
CMA chairman of the Board of Commissioners and managing director Dr Ahmad A Al-Melhem said: “This transaction is a landmark transaction in the history of Kuwait’s capital markets, and an important step towards achieving the ambitious national development goals set out in Kuwait Vision 2035 with an aim to strengthen the country’s position as a regional financial centre and give the private sector a stronger role and a greater opportunity to develop the national economy.”
“Kuwait, home to the first stock exchange in the Gulf, will soon become home to the only stock exchange in the Gulf that’s 94 per cent owned by the private sector. This move not only validates Kuwait’s reform policy but also reflects the CMA’s commitment to upgrade the Kuwaiti capital markets and its core drivers,” he added.
Boursa Kuwait was founded in 2014 by the CMA Board of Commissioners Resolution No. 37/2013 to replace the Kuwait Stock Exchange (KSE).
Since then, the CMA has embarked on a mission to transform the company into a leading regional exchange that is built on global best practices and structures. The transformation program introduced reforms to increase competitiveness and liquidity, reinforce transparency and management, elevate investor confidence, and attract international, regional, and domestic investments.
As a result of the successful implementation of these reforms since 2014, Boursa Kuwait was upgraded to Emerging Market status by the leading global indices. The exchange was included FTSE Russell Emerging Markets Index (FTSE) in September 2017 and S&P Dow Jones Global Benchmark Indices with an emerging market classification in December 2018.
The privatization process is being implemented in two phases. The first phase took place in February 2019 wherein by law and through an open and transparent process, a strategic consortium consisting of domestic and international Securities Exchange operator acquired a 44 per cent stake in the company. The consortium comprised Athens Stock Exchange, National Investments Company, First Investment Company, and Arzan Financial Group.
The second phase, the nation-wide IPO, is expected to be implemented in the last quarter of 2019 with the distribution of the CMA’s 50 per cent stake in the company to citizens. Upon the allocation of the remaining 50 per cent of Boursa Kuwait's shares, Boursa Kuwait will be owned by citizens and the private sector (94 per cent), while the Kuwaiti government through the Public Institution for Social Security will retain the remaining 6 per cent. – TradeArabia News Service
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