flynas IPO Overview

flynas Company SJSC ("flynas" or "the Company"), one of the leading low-cost carriers (LCC) in the Middle East and North Africa (MENA) region, announces its intention to proceed with an Initial Public Offering (IPO) and listing of its ordinary shares on the Main Market of the Saudi Exchange (Tadawul). The Capital Market Authority (CMA) approved the Company's application on March 26, 2025 for the registration and offering of 51,255,568 ordinary shares, representing 30% of the Company's total issued share capital upon completion of the Offering.

Key Details:

• Offering Structure: The IPO comprises 51,255,568 ordinary shares, representing 30% of flynas's total issued share capital. The offering includes the sale of 33,828,675 existing ordinary shares (the "Sale Shares") by the Company's existing shareholders and treasury shares (8,320,237 shares), as well as the issuance of 17,426,893 new ordinary shares (the "New Shares").
• Selling Shareholders: The Sale Shares (19.8% of total share capital) will be offered by National Flight Services Company LLC, Kingdom Holding Company SJSC, Nasser Ibrahim Rashid Al Rashid, Mawarid Investment Company, Hamza Bahi Adeen Alsayed Al Kholi, Saudi General Investment Trading and Services Company, Salman Mohammed Khalid bin Hethlain, and Yousef Abdulsattar Qassem Al Maimani.
• Use of Proceeds: The net proceeds from the sale of New Shares (10.2% of total share capital) will be used by the Company for increasing and expanding its fleet, network, and establishing new operations centers, as well as for general corporate purposes. The net proceeds from the Sale Shares will be distributed to the Selling Shareholders on a pro-rata basis according to their respective ownership percentage.
• Lock-up Period: Following completion of the Offering, Current Shareholders will collectively own 70% of the Company's share capital and will be subject to a 6-month lock-up period. The Company is subject to the same lock-up period.

The final Offer Share price will be determined following the book-building process.

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IPO Summary

Overview of flynas:

flynas is Saudi Arabia's market-leading Low-Cost Carrier (LCC) in terms of revenue and passengers, operating with the largest fleet among Saudi low-cost airlines. Established in 2010 (beginning operations in 2007 as a business unit under NAS Holding), the company generates revenue through three business segments: scheduled domestic and international flights (flynas LCC), religious travel services (flynas Hajj and Umrah), and private jet management and chartering (flynas General Aviation Services, or NasJet).

Fleet Expansion and Network Growth

The company has confirmed a firm purchase order with Airbus for 195 narrow-body aircraft (159 A320neo and 36 A321neo) and has concluded a separate agreement for 30 wide-body A330neo aircraft (15 firm orders with options for 15 more). As of September 2024, flynas has received 53 A320 aircraft with 157 remaining on firm order. This expansion aims to make flynas one of the largest A320neo operators in the MENA region.

By December 2024, flynas was operating across 30 countries, serving 72 destinations (16 domestic and 56 international) through 139 routes. The airline operates from four bases across Saudi Arabia: Riyadh, Jeddah, Dammam, and Medinah. Through codesharing and interline arrangements with international full-service carriers, flynas provides passengers access to an enlarged network of 128 destinations.

Operational Excellence

The company transported approximately 14.7 million passengers in 2024, representing 31% year-over-year growth from 11.2 million in 2023. In the first nine months of 2024, flynas operated an average of 1,861 flights weekly with a seat occupancy rate of 85.2% (compared to 78.4% in the same period of 2023), reaching 86% for the full year 2024.

flynas maintains industry-leading operational efficiency with an 88% on-time performance in the first nine months of 2024 (up from 84% in 2023 and 75% in 2022), and is the only Saudi LCC to disclose this metric. Additionally, the airline boasts superior fuel efficiency, with 87% of its fleet (52 out of 61 aircraft) featuring CFM (LEAP-1A) powered engines.

Financial Performance

The company has maintained consistent profitable growth since 2019 (except during the COVID-affected year of 2020), driven by a well-balanced business model, revenue growth, network expansion, enhanced operational efficiency, and prudent capital management.

For fiscal year 2024, flynas reported record results:

• Revenue of SAR 7.56 billion (up 19% year-over-year)
• EBITDA of SAR 2.18 billion (up 31% year-over-year)
• Net profit of SAR 434 million (up 8% year-over-year)

Leadership and Strategy

flynas is led by an experienced management team with over 120 years of cumulative experience across various operational and financial areas. The company emphasizes local talent development with 100% Saudization of co-pilots and flight dispatchers, and more than 52% overall Saudization across the airline.

The company is executing a clear network and fleet strategy to capitalize on favorable conditions in the Saudi and regional aviation markets, with the vision of becoming the leading LCC in the MENA region for short and medium-haul flights by 2030.

SkyTrax has ranked flynas as the world's 4th best LCC for 2024 and the best LCC in the Middle East for the 7th consecutive year (2017-2024).

Investor Groups

The IPO offering is restricted to two specific groups of investors:

Tranche (A): Participating Parties

This tranche includes institutions and companies such as investment funds, qualified foreign investors, and GCC investors with legal personality. These participating parties are eligible to participate in the book building process as specified under the CMA's Instructions for Book Building Process and Allocation Method in Initial Public Offerings.

Initially, 51,255,568 offer shares (representing 100% of total offer shares) will be allocated to Participating Parties. However, if Individual Subscribers (Tranche B) fully subscribe to their allocation, the Financial Advisors reserve the right to reduce Participating Parties' allocation to a minimum of 41,004,454 shares (80% of total offer shares).

The allocation among Participating Parties will be determined by the Financial Advisors in consultation with the company using a discretionary allocation mechanism. Some Participating Parties may not receive any allocation, based on decisions deemed appropriate by the company and Financial Advisors.

Tranche (B): Individual Investors

This tranche includes:

• Saudi natural persons
• Saudi female divorcees or widows with minor children from marriages to non-Saudi individuals (who may subscribe on behalf of those children for her own benefit, provided she can prove her status)
• GCC nationals with bank accounts at one of the Receiving Agents who are eligible to open investment accounts

A maximum of 10,251,114 offer shares (20% of total offer shares) will be allocated to Individual Subscribers. If this tranche is not fully subscribed, the Financial Advisors may reduce the allocation proportionally based on actual subscription levels.

Important notes on subscription rules:

• Subscriptions made by a person in the name of his divorcee will be deemed invalid and subject to legal enforcement
• In case of duplicate subscriptions, only the first subscription will be accepted, and subsequent ones will be considered void

Substantial Shareholders of the Company Pre- and Post Offering

Notes:

1. None of the direct Substantial Shareholders owns any of the Company’s shares indirectly as of the date of this Prospectus.
2. The ownership percentages have been rounded to the nearest decimal place.

It should also be noted that there are Substantial Shareholders in the Company who have indirect ownership of the Company’s shares, each of whom indirectly owns 5% or more of the Company’s shares. These are:

• Khalid bin Sultan bin Abdulaziz Al Saud
• Alwaleed bin Talal bin Abdulaziz Al Saud
• The Public Investment Fund (“PIF”)

Indirect Substantial Shareholders of the Company Pre- and Post Offering

Notes:

1. The ownership percentages have been rounded to the nearest decimal place.
2. The indirect ownership of the Substantial Shareholders who indirectly own 5% or more of the Company’s shares arises from the following:
   1. Khalid bin Sultan bin Abdulaziz Al Saud owns 100% of the shares in National Flight Services Company, which in turn owns 39.016% of the Company’s shares pre-Offering.
   2. Alwaleed bin Talal bin Abdulaziz Al Saud owns 78.14% of the shares in Kingdom Holding Company, which in turn owns 37.077% of the Company’s shares pre-Offering.
   3. The Public Investment Fund (PIF) owns 16.87% of the shares in Kingdom Holding Company, which in turn owns 37.077% of the Company’s shares pre-Offering.

Expected Offering Timetable

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Further updates regarding this IPO will be provided as more information becomes available.

- Reporting by Zaid, Sahm News team