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Tadawul Attracts Six New Listings in May

Trading screen in the Saudi financial market (Reuters)
Trading screen in the Saudi financial market (Reuters)
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Tadawul Attracts Six New Listings in May

Trading screen in the Saudi financial market (Reuters)
Trading screen in the Saudi financial market (Reuters)

The current month of May is witnessing momentum in new IPOs in the Saudi financial market, as two companies and a real estate fund were listed during the first two weeks, while three other companies are preparing to be listed in the main and parallel markets.
Since the beginning of 2024, the shares of three companies have been listed on the main market, and 10 on the parallel market (Nomu). The Capital Market Authority is also working to maintain the pace of IPOs by offering 24 new companies.
In the first week of May, shares of Yaqeen Capital were listed on the Nomu-Parallel Market, at SAR 40 per share. The shares offered for subscription represent 20 percent of the capital, which amounts to SAR 150 million divided into 15 million shares.
In parallel, subscription began to units of Alistithmar AREIC Diversified REIT Fund. Qualified investors include institutional investors such as companies, investment funds and commercial entities, to whom 80% of the offered units will be allocated, while the second tranche includes retail investors, who will be entitled to a maximum of 20% of the offered units.
The minimum subscription amount is SAR 1,000 ($266.6), while the unit price upon offering is SAR 10 ($2.67).
Meanwhile, the subscription for Horizon Educational began on Sunday on the Nomu-Parallel Market at a price range of SAR 54 per share.
Shares offered for subscription represent 20 percent of the post-IPO capital and 25 percent of the company’s shares before the capital hike. The company intends to increase its capital from SAR 20 million to SAR 25 million through offering 500,000 shares.
Fitch Ratings Agency expects the momentum of IPOs in the Gulf countries to continue during the current year, supported by government pledges for privatization, including the sale of minority stakes by government-related entities and the establishment of public subscription funds, as well as reducing trading commissions to improve market liquidity and attract more local companies.

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Saudi Arabia Approves ‘Golden Handshake’ Program Inspired by Global Models

Employees at the Saudi Ministry of Human Resources and Social Development booth at a conference (X)
Employees at the Saudi Ministry of Human Resources and Social Development booth at a conference (X)
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Saudi Arabia Approves ‘Golden Handshake’ Program Inspired by Global Models

Employees at the Saudi Ministry of Human Resources and Social Development booth at a conference (X)
Employees at the Saudi Ministry of Human Resources and Social Development booth at a conference (X)

Saudi Arabia has introduced the “Golden Handshake” program to offer financial incentives for government employees to voluntarily resign.

The goal is to reduce costs related to salaries and benefits for long-serving workers, creating space for others with lower salaries and skills suited to the country’s digital transformation.

The government has allocated SAR 12.7 billion ($3.38 billion) for the first three years of the program, inspired by similar global initiatives.

As of the fourth quarter of 2024, Saudi Arabia’s public sector employs 1.2 million people, excluding the military. The kingdom spends about 40% of its budget on salaries and employee compensation, with SAR 544 billion ($145 billion) set aside for this in 2024.

Experts, who spoke to Asharq Al-Awsat, have differing opinions on the financial compensation under Saudi Arabia’s “Golden Handshake” program for government employees. One expects the severance package to range from 12 to 24 months of salary, while another estimates it could be from 24 to 60 months of salary.

While the “Golden Handshake” is not new in Saudi Arabia, where large companies offer early retirement packages, it is a new approach for the public sector, which is traditionally seen as offering job security.

The Saudi program is similar to global initiatives encouraging voluntary resignations when employees’ skills are no longer needed. For example, the US offers up to $25,000 for employees who leave voluntarily, while the UK offers up to £149,800 for retiring police officers.

Dr. Mohammed Dulaim Al-Qahtani of King Faisal University expects compensation to range from 12 to 24 months of salary. For example, with a monthly salary of SAR 15,000, the package could range from SAR 180,000 to SAR 360,000.

Badr Al-Anzi, board member of the Saudi Human Resources Association, believes the compensation could range from 24 to 60 months of salary. For example, with a monthly salary of 15,000 riyals, the minimum compensation would be SAR360,000, and the maximum could reach SAR900,000.

Priority for the program will be given to employees with lower qualifications, and it will be available only after other options, such as transfers and skill development, have been explored. Employees close to retirement are excluded.

The government has also allowed agencies to announce vacant positions internally for five days before following regular procedures, to fill positions through transfers between government departments.

The program is expected to provide financial liquidity, encourage private-sector innovation, improve government efficiency, and reduce the financial burden on the state budget. The Ministry of Human Resources and Social Development is coordinating with relevant authorities to set the program’s guidelines.

Ultimately, the “Golden Handshake” is a significant initiative aimed at improving the efficiency of the public sector, with attractive financial compensation expected for those who participate.