Oman’s OQ Gas Networks expected to price IPO at top of range

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Oman’s OQ Gas Networks (OQGN), the pipeline business of state oil giant OQ, is expected to price its $771m initial public offering (IPO) at the top of the marketed range, according to terms seen by Reuters.

Orders below 140 Omani baisas ($0.36) per share risk missing out on the deal, one of the banks on the transaction said in a message to investors seen by Reuters.

Books were oversubscribed multiple times at this level, and will close on Monday, it said.

Three anchor investors have already committed to taking 10 per cent each of the offering at the top end of the range, the company said last month.

These are Saudi Omani Investment Company, a unit fully-owned by Saudi Arabia’s Public Investment Fund; Falcon Investments, a subsidiary of the Qatar Investment Authority; and Fluxys International.

OQ is selling a 49 per cent stake, equivalent to 2.12 billion shares, in its gas pipelines business between 131 and 140 Omani baisas per share.

At the top of the range, OQGN would be the country’s largest IPO in history, exceeding Oman Telecommunications’ $748m IPO in 2005.

Bank of America, Bank Muscat and EFG Hermes are joint global coordinators on the transaction. Shares are expected to debut on the bourse in Muscat on or around October 24.

Reuters first reported the IPO plans last May.

Oman follows other GCC countries in issuing IPO

Oman follows Abu Dhabi and Saudi Arabia in looking at sales of stakes in energy assets, seeking to capitalise on a rebound in crude prices to attract foreign investors and boost interest in their respective exchanges.

As the exclusive operator of Oman’s gas transport system, OQGN supplies natural gas to power plants, free zones, industrial clusters, liquefied natural gas complexes and other customers.

Oman is primarily reliant on hydrocarbon revenue despite some reforms and plans to diversify its economy.

The reforms and a shake-up of state entities are being driven by Sultan Haitham bin Tariq al-Said, who took the throne in early 2020 after the death of Sultan Qaboos, who ruled for nearly five decades.