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Saudi Capital Market Authority Approves New IPOs

The Saudi Capital Market Authority headquarters is seen in Riyadh. (Reuters file photo)
The Saudi Capital Market Authority headquarters is seen in Riyadh. (Reuters file photo)
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Saudi Capital Market Authority Approves New IPOs

The Saudi Capital Market Authority headquarters is seen in Riyadh. (Reuters file photo)
The Saudi Capital Market Authority headquarters is seen in Riyadh. (Reuters file photo)

The Capital Market Authority (CMA) in Saudi Arabia approved requests for initial public offerings and listings in the main stock market (Tadawul) and the parallel market (Nomu).

The CMA Board approved the request of the Arab Internet and Communications Services Company (STC Solutions) to offer 24 million shares for public subscription, representing 20 percent of the company’s share capital.

According to a statement, CMA’s approval on the application shall be valid for six months from the resolution date. The approval shall be deemed canceled if the offering and listing of the Company’s shares are not completed within this period.

STC Solutions is part of the STC Group and provides basic information and communication technology services, information technology management services, and digital services.

Later, the Authority issued its resolution approving Arabian Contracting Services Company’s application for the offering of 15 million shares representing 30 percent of the Company’s share capital.

The Company’s prospectus will be published within sufficient time prior to the start of the subscription period.

The CMA also announced its approval of the applications of Banan Real Estate and Canadian Medical Center for the registration of its shares for a direct listing in Nomu.

“Trading these shares will be confined to Qualified Investors stipulated in the Glossary of Defined Terms Used in the Regulations and Rules of the Capital Market Authority. The registration document will be published within sufficient time prior to listing,” read the statement.

The Authority indicated that prospective qualified investors should conduct their own due diligence on the information disclosed in the registration document.

It stressed that its approval on the application should never be considered as a recommendation to invest in the shares of the company.

“The CMA’s approval on the application merely means that the legal requirements as per the Capital Market Law and its Implementing Regulations have been met.”

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Saudi Arabia's Digital Advertising Boom: Addressing Economic Leakage, Boosting Local Content

A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
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Saudi Arabia's Digital Advertising Boom: Addressing Economic Leakage, Boosting Local Content

A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
A digital advertising event recently held in Riyadh (Asharq Al-Awsat)

Saudi Arabia’s digital advertising sector is experiencing rapid growth, but a significant portion of its revenues is leaking to foreign platforms. To maximize the impact on the national economy, experts are calling for strategies to curb this outflow and redirect it to local channels.

The importance of retaining digital ad revenues lies in the substantial size of this market. It is estimated that approximately $1 billion in ad spent is lost annually to foreign platforms, representing a considerable loss to Saudi Arabia’s economy.

Dr. Ebada Al-Abbad, CEO of Marketing and Communications at Tadafuq, a Saudi digital advertising network, told Asharq Al-Awsat that the problem stems from the fact that although advertisers, products, and audiences are often local, the largest share of financial gains goes to foreign platforms. He estimated that 70-80% of the $1.5 billion spent on digital advertising in Saudi Arabia in 2022 went to global platforms such as Google and Facebook. This results in the national economy losing nearly $1 billion annually from this sector alone.

Al-Abbad noted that government agencies in Saudi Arabia also contribute to the outflow. He explained that public sector spending on digital advertising, intended to raise awareness among citizens and residents, frequently ends up on foreign platforms. Government spending makes up about 20-25% of the total digital ad market in the Kingdom, meaning hundreds of millions of riyals leave the country annually, weakening the local digital economy.

Al-Abbad argues that Saudi Arabia needs strong local digital ad networks to keep this revenue within the national economy. These networks would help create jobs, drive innovation, and promote cultural diversity in digital content. Developing local platforms would also enhance Saudi Arabia’s digital sovereignty by ensuring that data remains within the country and is not controlled by foreign entities.

Moreover, local networks would reduce dependence on international platforms, ensuring that the economic benefits of digital advertising remain in the Kingdom, he said, stressing that this would align with Saudi Arabia’s broader Vision 2030 goals, which emphasize building a robust, diversified economy driven by local industries and digital transformation.

Globally, the digital advertising sector is growing rapidly. In 2022, worldwide spending on digital ads reached $602 billion, and it is projected to hit $876 billion by 2026. In the Middle East and North Africa (MENA) region, the digital ad market grew to $5.9 billion in 2022, with Saudi Arabia’s market accounting for over $1.5 billion.

In other countries, the digital ad sector plays a crucial role in boosting national economies. For example, in the United States, the digital advertising industry contributed $460 billion to the GDP in 2021, about 2.1% of the total. In the UK, the sector accounted for 1.8% of GDP in 2022. This shows how important digital advertising can be in driving economic growth.

One of the key challenges facing Saudi Arabia’s digital ad sector is the dominance of global platforms like Google and Facebook, which control 60% of the global digital ad market, Al-Abbad told Asharq Al-Awsat. This dominance results in a significant outflow of revenue and allows these platforms to control digital data and content. He warned that this could undermine Saudi Arabia’s national sovereignty over its digital economy.

To counter this, he emphasized that Saudi Arabia needs to build competitive local networks that can retain a larger share of the market. This will not only keep more revenue in the country but also strengthen the Kingdom’s control over its digital data and content.