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IPO Monitor | PIF-Backed Umm Al Qura Eyes Tadawul Listing to Power Makkah's $27B MASAR Transformation - What to Know
Tadawul All Shares Index TASI.SA | 12433.58 | +0.15% |
Umm Al Qura IPO Overview
Saudi Arabia – February 3, 2025 – Umm Al Qura for Development and Construction (“Umm Al Qura” or the “Company”), the owner, developer, and operator of MASAR Destination—one of Mecca’s largest urban redevelopment projects—today announced its intention to conduct an initial public offering (IPO) and list its ordinary shares on the Main Market of the Saudi Exchange (“Tadawul”).
Regulatory Approvals
The IPO follows key regulatory milestones:
- On December 8, 2024, the Saudi Exchange granted conditional approval for the Company’s Main Market listing.
- On December 24, 2024, the Capital Market Authority (CMA) approved the registration of the Company’s share capital and the issuance of 130,786,142 new shares (the "Offer Shares"), representing 9.09% of post-capital-increase equity.
Use of Proceeds
Net proceeds from the Offering will be allocated to:
- Project Development: Funding land settlements, infrastructure upgrades, and activation of the MASAR Destination.
- Financial Obligations: Covering project financing expenditures.
- Corporate Operations: Supporting sales, marketing, administrative, and general operational costs.
Listing Details
- Lock-Up Period: Substantial shareholders and concert parties are subject to a 6-month lock-up starting from the first trading day.
- Pricing Mechanism: Final Offer Share pricing will be determined post-book-building and prior to the Individual Investor subscription period.
- Listing Timeline: Shares will begin trading on Tadawul’s Main Market following completion of IPO and listing formalities with the CMA and Saudi Exchange.
Introducing the new IPO feature on Sahm platform: A step-by-step guide to subscribing to the IPO
IPO Summary
Category | Details |
---|---|
Company Name | Umm Al Qura for Development and Construction |
Market | Main Market (TASI) |
Core Activities | Real Estate Development and Construction Co, which is the owner of Masar Destination project. |
Pre-IPO Capital | SAR 13.08 billion |
Post-IPO Capital | SAR 14.39 billion |
Number of Shares before IPO | 1.31 billion |
Number of shares after IPO | 1.44 billion |
Par Value | SAR 10 per share |
Issue Percentage | 9.09% after increase (10% before increase) |
Number of Offered Shares | 130.79 million |
Qualified Subscribers | Participating institutions & Retail investors |
Total Number of Shares Offered to Retail Investors | 13.08 million shares |
Minimum Number of Offer Shares to be Applied for by Individual Investors | 10 shares |
Maximum Number of Offer Shares to be Applied for by Individual Investors | 2.5 million shares |
Minimum Number of Offer Shares to be Applied for by Institutional Investors | 100,000 shares |
Maximum Number of Offer Shares to be Applied for by Institutional Investors | 71.93 million shares |
Overview of Umm Al Qura:
Umm Al Qura for Development and Construction: Pioneering Makkah’s Urban Transformation
1. Founding & Ownership
Established in 2012 under a royal mandate to redevelop King Abdulaziz Road in Makkah, Umm Al Qura owns, develops, and operates MASAR Destination—a transformative urban project replacing six unplanned settlements. The Company’s majority shareholders include prominent state-owned and private Saudi entities:
- Public Investment Fund (PIF)
- General Organization for Social Insurance (GOSI)
- Dallah Al-Baraka Holding
2. MASAR Destination: A Visionary Redevelopment
Strategically located along Makkah’s western border, MASAR spans 3.5 kilometers from the 3rd Ring Road intersection to 550 meters from Al Haram’s King Fahad Gate. Designed to address future infrastructure, mobility, and hospitality demands, the project capitalizes on Makkah’s globally significant real estate market.
3. Project Scale & Components
MASAR encompasses 205 investment plots (total area: 641,000 sqm) with a Gross Floor Area (GFA) of 5.7 million sqm, structured as a mixed-use global destination:
4. Hospitality & Housing:
- Serviced Apartments: 31.6% of GFA (18,000 keys; 1.8M sqm).
- Hotels: 31.1% of GFA (23,000 keys; 1.8M sqm).
- Residential Units: 29.3% of GFA (9,000 units for sale).
5. Retail & Services:
- Retail space: 5.7% of GFA (330,000 sqm, including a mall, two centers, and walkway outlets).
- Complementary facilities: Hospital, central mosque, offices, and support services.
6. Strategic Progress & Financial Strength
- Development Pipeline: As of January 16, 2025, 61 plots (30% of total) are under agreements for sale, lease, or partnership-driven development.
- Infrastructure Milestone: 99.77% of critical infrastructure completed as of November 2024.
- Financial Position (as of June 30, 2024):
- Share capital: SAR 13.1+ billion (raised through multiple rounds).
- Bank facilities: SAR 14+ billion (SAR 9.8 billion utilized).
- Workforce: Over 100 employees, with a 60%+ Saudization rate.
7. Leadership Perspectives
Abdullah Saleh Kamel, Chairman of Umm Al Qura:
“This IPO is a pivotal moment in our journey to advance Makkah’s development under Vision 2030. MASAR is a cornerstone project to accommodate pilgrims and visitors, and our listing invites investors to participate in shaping Makkah’s future. We are committed to maximizing shareholder value through strategic execution.”
Yasser Abdulaziz Abu Ateek, CEO of Umm Al Qura:
“MASAR redefines urban living in Makkah. Our IPO accelerates growth and aligns with Vision 2030’s goals to elevate experiences for residents and visitors. This listing underscores our proven track record and dedication to creating world-class destinations.”
8. Future Outlook
Upon completion, MASAR will deliver 50,000+ hospitality and residential units, with an estimated total development value of SAR 100 billion, positioning it as a cornerstone of Makkah’s economic and social transformation.
Investor Groups
Tranche (A): Institutional & Qualified Investors
- Eligibility:
- Investment funds, GCC corporate investors, qualified foreign institutions, and foreign investors under swap agreements.
- Governed by CMA’s Instructions for Book Building Process and Allocation Method in IPOs.
- Allocation:
- Initial Provision: 130,786,142 Offer Shares (100% of total).
- Adjustment Clause: If demand from Individual Investors (Tranche B) is sufficient, allocation to Tranche A may be reduced to 117,707,528 Shares (90% of total).
- Final Allocation: Determined by Joint Financial Advisors post-subscription, using discretionary mechanisms in coordination with the Company.
Tranche (B): Individual Investors
- Eligibility:
- Saudi natural persons, including Saudi widows/divorcees with minor children (entitled to invest on behalf of dependents).
- Non-Saudi residents in Saudi Arabia or GCC nationals with active investment accounts at Receiving Agents.
- Allocation:
- Maximum: 13,078,614 Offer Shares (10% of total).
- Proportional Reduction: Unsubscribed shares may be proportionally reduced by Joint Financial Advisors.
Legal Restrictions on Non-Saudi Ownership
Key Provisions Under Saudi Law
- Royal Decree M/15 (2000G): Prohibits non-Saudis from owning, acquiring easement, or usufruct rights over real estate in Makkah and Madinah.
- Applies to non-Saudi individuals, foreign companies, and Saudi companies with non-Saudi shareholders (exceptions limited).
- 2025G Regulatory Update:
- Exemption for Listed Companies: Non-Saudis may invest in Saudi-listed firms owning property in Makkah/Madinah, subject to:
- Foreign Strategic Investor Exclusion: Prohibits direct ownership by foreign strategic investors in the Company.
- 49% Ownership Cap: Combined non-Saudi ownership (natural/legal persons) must not exceed 49% of shares at any time.
- Exemption for Listed Companies: Non-Saudis may invest in Saudi-listed firms owning property in Makkah/Madinah, subject to:
Implications for the Offering
- Non-Saudi investors are permitted to participate in the IPO indirectly through Tadawul-listed shares, provided the aggregate foreign ownership threshold remains below 49%.
- Foreign strategic investors (as defined by law) are excluded from the Offering.
Substantial Shareholders of the Company Pre- and Post Offering
Pre-Offering | Post-Offering | |||||
---|---|---|---|---|---|---|
Shareholder | Number of Shares | Total Nominal Value (SAR) | Percentage | Number of Shares | Total Nominal Value (SAR) | Percentage |
GOSI | 345,980,070 | 3,459,800,700 | 26.45% | 345,980,070 | 3,459,800,700 | 24.05% |
PIF | 282,302,039 | 2,823,020,390 | 21.59% | 282,302,039 | 2,823,020,390 | 19.62% |
Dallah Albaraka Holding Company | 103,111,395 | 1,031,113,950 | 7.88% | 103,111,395 | 1,031,113,950 | 7.17% |
Shareholders Acting in Concert | 227,465,344 | 2,274,653,440 | 17.39% | 227,465,344 | 2,274,653,440 | 15.82% |
Total | 958,858,848 | 9,588,588,480 | 73.31% | 958,858,848 | 9,588,588,480 | 66.66% |
Source: The Company
* The number, value and percentage of shares owned by the Shareholder Dallah Albaraka Holding Company were calculated once upon calculation of the final total number of shares, their value and ownership percentage, in order to avoid calculating them more than once within the total.
Expected Offering Timetable
Event | Date |
---|---|
Bidding and Book-Building Period for Participating Parties | A period of five (5) business days commencing on Sunday 17/08/1446H (corresponding to 16/02/2025G) until the end of Thursday 21/08/1446H (corresponding to 20/02/2025G). |
Subscription Period for Individual Subscribers | A period of three (3) business days commencing on Wednesday 05/09/1446H (corresponding to 05/03/2025G) until the end of Sunday 09/09/1446H (corresponding to 09/03/2025G). |
Deadline for Submission of Subscription Application Forms for Participating Parties Based on the Number of Provisionally Allocated Offer Shares | Monday 03/09/1446H (corresponding to 03/03/2025G). |
Deadline for Payment of Subscription Monies for Participating Parties Based on the Number of Provisionally Allocated Offer Shares | Wednesday 05/09/1446H (corresponding to 05/03/2025G). |
Deadline for Submission of Subscription Application Forms and Payment of Subscription Monies for Individual Subscribers | Sunday 09/09/1446H (corresponding to 09/03/2025G). |
Announcement of Final Allocation of Offer Shares | Thursday 13/09/1446H (corresponding to 13/03/2025G). |
Refund of Excess Subscription Monies (if any) | Sunday 16/09/1446H (corresponding to 16/03/2025G). |
Expected Date of Commencement of Trading on the Exchange | Trading of the Company’s shares on the Exchange is expected to commence after fulfillment of all relevant statutory requirements. Trading will be announced on the website of the Saudi Exchange. |
Note: The above timetable and dates therein are indicative. Actual dates will be communicated through announcements appearing on the websites of the Saudi Exchange (www.saudiexchange.sa), the Financial Advisors (www.gibcapital.com), (www.albilad-capital.com), (www.alrajhi-capital.com), and the Company (www.ummalqura.com.sa).
Read the full Prospectus
Introducing the new IPO feature on Sahm platform: A step-by-step guide to subscribing to the IPO
Further updates regarding this IPO will be provided as more information becomes available.
- Reporting by Zaid, Sahm News team