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Retail investors start subscription to East Pipes 630,000 shares today
Logo of East Pipes Integrated Company for Industry
Retail investors start today, Jan. 24, subscription to nearly 630,000 of East Pipes Integrated Company for Industry’s shares at SAR 80 a share, as set in the book-building process.
On Sept. 29, 2021, the company obtained the approval of the Capital Market Authority (CMA) on the initial public offering (IPO) to offer 6.3 million shares, representing 30% of capital, reaching SAR 210 million, on the Saudi Exchange (Tadawul).
The retail subscription period will run from Jan. 24 to Jan. 25. The institutional offering closed last week and the offering was 71.8x covered.
The company’s IPO is the first to be held this year. Last year witnessed nine IPOs, including Almunajem Foods Co., Alkhorayef Water and Power Technologies Co., Theeb Rent a Car Co., Tanmiah Food Co., solutions, International Company for Power and Water Projects (ACWA Power), Arabian Contracting Services Co. (Al Arabia), Nayifat Finance Co., and Saudi Tadawul Group.
Company Profile
East Pipes Integrated Company for Industry was established as a limited-liability company (LLC) in Dammam on May 30, 2010, with SAR 500,000 capital.
On Sept. 22, 2020, it was converted into a joint stock company, with SAR 76 million capital. The company's extraordinary general meeting (EGM) approved in December 2020 rebranding the company and increasing its capital to SAR 210 million.
The company’s business portfolio comprises manufacturing of pipes, tubes, hollow shapes from iron and steel, as well as tubes connections, in addition to coating metals.
Factories
The company is manufacturing the helicalsubmerged arc welded (HSAW) pipes used in the water, oil and gas projects. It currently runs three factories, enabling it to provide clients with a set of integrated solutions.
|
Factories |
|||
|
Factory |
Date of Inception |
Production Capacity |
Outer Diameter (inches) |
|
HSAW Pipes
|
2006 |
375,000 metric tons |
20-100 |
|
Double Jointing (DJ) |
2014 |
350,000 metric tons |
20-60 |
|
Coating |
2011 |
4 mln square meters per annum |
2-120 |
Suppliers
The company depends on suppliers to outsource its products. It reported total purchases of SAR 773.4 million in 2019, SAR 1.17 billion in 2020, and SAR 551.7 million by March 31, 2021.
|
Key Suppliers (SAR mln) |
|||
|
Client |
2019 |
2020 |
March 31, 2021 |
|
Saudi Iron and Steel (Hadeed) |
462.2 |
379.1 |
141.3 |
|
Golden Source Steel |
203.5 |
444.1 |
348.7 |
|
Daewoo International
|
77.0 |
128.7 |
-- |
|
Bottega Trade and Service |
7.2 |
7.3 |
6.5 |
|
Posco International |
-- |
177.1 |
26.1 |
|
Borouge Ltd. |
-- |
-- |
23.6 |
|
Total |
773.4 |
1173.4 |
551.7 |
Properties
The company does not own any properties. All of them are leased.
|
Leased Properties |
||
|
Lessor |
Site |
Annual Rent (SAR ‘000) |
|
Modon |
A land plot for industrial purposes spanning 15,000 sqm in Dammam 2nd Industrial City. |
60.0 |
|
Modon |
A land plot for industrial purposes spanning 78,900 sqm in Dammam 2nd Industrial City. |
315.6 |
|
Modon |
A land plot for industrial purposes spanning 45,700 sqm in Dammam 2nd Industrial City. |
183.0 |
|
Modon |
A land plot for industrial purposes spanning 8,100 sqm in Dammam 2nd Industrial City. |
162.3 |
|
SFSCO |
Residential buildings in Dammam 2nd Industrial City. |
875.0 |
|
Majd Investment* |
A 600,000 sqm land plot in Dammam 2nd Industrial City. |
6400.0 |
|
Fajr Najd |
A residential building spanning 1,200 sqm in Dammam 2nd Industrial City. |
320.0 |
|
Company Profile |
|
|
Company |
East Pipes Integrated Company for Industry |
|
Market |
The Saudi Exchange (Tadawul) |
|
Core activities |
Manufacturing of pipes |
|
Capital |
SAR 210 mln |
|
Number of shares |
21 mln |
|
IPO Summary |
|
|
Issue Percentage (%) |
%30 |
|
Number of Shares Offered |
630,000 shares, representing 10% of total offered shares reaching 6.3 mln shares |
|
IPO Price |
SAR 80/ share |
|
Qualified subscribers |
Individual investors: This tranche comprises Saudi Arabian natural persons, in addition to any non-Saudi natural person who is resident in the Kingdom or any GCC natural persons, provided they have a bank account with one of the receiving entities and are allowed to open an investment account. |
|
IPO minimum limit for retail investors |
10 shares |
|
IPO maximum size for retail investors |
250,000 shares |
|
Retail subscription period |
Jan. 24-25, 2022 |
|
Final allotment |
Jan. 30, 2022 |
|
Surplus refunds |
Feb. 2, 2022 |
|
Special Information |
|
|
Financial advisor, lead manager, underwriter and book runner |
SNB Capital |
|
Receiving banks |
Saudi National Bank (SNB) |
Welspun Holding Co. is one of the company’s major shareholders with a 35.01% stake.
|
Company Shareholders |
||||
|
Shareholders |
Before IPO |
After IPO |
||
|
Number of shares (mln) |
Ownership (%) |
Number of shares (mln) |
Ownership (%) |
|
|
Welspun Holding Co. |
10.50 |
50.01% |
7.35 |
35.01% |
|
Aziz Co. |
5.96 |
28.50% |
4.19 |
19.95% |
|
Vision Invest |
3.46 |
16.50% |
2.43 |
11.55% |
|
Mohawarean |
1.05 |
4.99% |
0.73 |
3.49% |
|
Public |
-- |
-- |
6.30 |
30.00% |
|
Total |
21.00 |
100% |
21.00 |
100% |
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