The Saudi Arabian government has launched a USD4 billion initial public offering for monopoly operator Saudi Telecommunications Company (STC). Of the 90 million shares on offer – equivalent to a 30% holding in the company – 60 million will be sold to private Saudi citizens while the remainder will go to a pension fund and a social insurance fund. The foundations for this flotation were laid by the telecoms law passed by the government earlier this year in an effort to expedite the country’s privatisation plans. Shares are priced at SAR170 (approximately USD45) each and will be sold in multiples of ten.
For the financial year ending December 2001 STC declared revenues of USD5.3 billion, up from USD4.5 billion in 2000, making STC the world’s 40th largest telco. Revenues in 2002 are on target to outstrip this, with turnover for the six months to June 2002 standing at USD3 billion. Profits were also healthy, at USD928 million for 2001 and USD348 million for the first half of 2002. At the end of June 2002 the company had 3.5 million mobile and 3.3 million wireline customers. The Saudi government has committed to introducing competition in the wireless market by 2004 and the fixed line sector by 2008.