Retail subscription to 2.45M shares of Modern Mills starts on TASI today

Logo of Modern Mills for Food Products Co.

Retail investors will start today, March 5, subscription to about 2.45 million shares of Modern Mills for Food Products Co. at SAR 48 each, as set by the book-building process.   

For More IPOs

The subscription process for the retail tranche will run for two days until March 6.  

The Capital Market Authority (CMA) approved, on Dec. 31, 2023, the company's request to float 24.55 million shares or 30% of the capital in an initial public offering (IPO).  

The company’s institutional offering, which ended last week, was 127x covered. 

The Modern Mills IPO is the second this year for the Main Market, after Middle East Pharmaceutical Industries Co. (Avalon Pharma).

Tadawul witnessed eight IPOs in 2023 including MBC Holding Group Ltd. Ltd,  Morabaha Marina and Mawarid Manpower Co. , Jamjoom Pharmaceuticals Factory Co. , First Milling Co. , Lumi Rental Co. , ADES Holding Co.,  and SAL Saudi Logistics Services Co.

Company Profile   

Modern Mills started as wheat mills under the General Food Security Authority (GFSA) in 1972. In 2016, it was named the Third Mills Company in Khamis Mushait, with its headquarters now in Jeddah.

It was founded to supply and produce flour products in Saudi Arabia, enhancing the Kingdom's food security. Its primary activities involve producing and storing flour and feed, focusing on flour products, animal feed, and bran production, packaging, and sales.

According to its commercial register, the company's purposes include wheat and barley milling and packaging, concentrated animal feed manufacturing, barley wholesale and retail, and goods transport.

The company operates through three mills in the southern, western (Makkah and Madinah), and northern regions of the Kingdom. The daily production capacity is 3,451 tons of flour and 1,400 tons of feed.

Modern Mills market share is approximately 24% by volume and 22% by value, as shown in the following table:

Modern Mills boasts the highest feed production capacity among milling firms, holding 53.8% of total capacity with around 1,400 tons daily.

It owns a subsidiary, Hasad Al-Arabia for Trade, a single-person company in Saudi Arabia, founded in 2022 in Jeddah to distribute the group's products.

The company employs 520 staff, 220 of whom are Saudi citizens, achieving a Saudization rate of 42.3%.

* Post-offering, the company will hold 818,320 treasury shares by purchasing 687,390 shares (84% of treasury shares) and receiving 130,930 shares (16% of treasury shares) as grants from sellers, to use in the employee stock program upon offering completion.