[Last updated: 1 January 2024, unless otherwise noted]
Listing application
An issuer seeking a listing on Main Market must submit the following items, among others:
- Letter of appointment of the financial advisor.
- Letter of appointment of the legal advisor.
- Listing application documents, which include a formal letter of application to the CMA, a standard form declaration, and declaration and undertaking signed by each director.
- Draft prospectus in Arabic.
- Audited financial statements of the issuer (and those of its subsidiaries if applicable) for each of the three financial years immediately preceding the listing application, as well as the latest interim audited financial statements, prepared in accordance with the standards set by SOCPA.
- Certified copies of all corporate documents of the issuer, including the by-laws and the commercial registration certificate, and its subsidiaries if applicable.
- Legal due diligence report prepared by the issuer's legal advisor.
- Financial due diligence report prepared by the reporting accountant.
- Letters of consent from all of the issuer's advisors and experts in relation to the use of their names, logos and statements for which they are responsible in the prospectus.
- All signed underwriting, sub-underwriting and distribution agreements entered into in connection with the IPO.
- Any other documents as may be required by the CMA.
During the period of the CMA's review of the issuer's listing application, the issuer is prohibited from engaging in any publicity relating to the offering or doing anything that could be deemed to be stimulating an interest in the issuer's securities. The issuer is required to restrict its public communications and use of offering related materials until the final allocation of shares has been completed.
The requirements for companies seeking to list on the Parallel Market are much reduced, with only one year of financial statements for the immediately preceding year required.
Prospectus
The main disclosure requirements for companies listing on the Main Market include, among others:
- Summary of the terms of the offering.
- Summary of the key information relating to the issuer.
- Risk factors relating to the business and operations of the issuer, the market or industry in which the issuer operates and the securities being offered to the public.
- Market overview summarizing the trends and industry information that are specific to the issuer's business.
- Description of the general nature of the business of the issuer.
- Details of the current and historical shareholding and capital structure of the issuer and the substantial shareholder(s) of the issuer.
- Detailed discussion by the management of the issuer's financial condition (particularly for the three years preceding the application).
- Summary of all material contracts and related party transactions entered into by the issuer (and its subsidiaries if applicable).
- Summary of the constitutional documents of the issuer.
- Summary of any intangible assets such as trademarks, patents or copyrights material to the issuer's business.
- Summary of any litigation or claim which may have a material effect on the issuer's business or financial position.
- Details of indebtedness of the issuer.
- Summary of the issuer's dividend policy.
- The issuer's intended use of proceeds.
- Details of the directors of the issuer and its senior management.
- Details of the general subscription terms and conditions.
The content requirements for a prospectus issued in connection with a Parallel Market listing are much reduced. For example, no market overview or detailed management discussion of the issuer's financial condition is required. The content requirements of the cross-listing document are also much reduced to those of prospectuses issued in connection with Main Market listings. However, specific information is required, including the purpose of the listing and the risk factors related to the listing.
Typical process and timetable
The length of time required to list a company on the Main Market from the kick-off meeting to the commencement of trading of its securities depends on many factors, such as the quality of the internal records of the company, the due diligence process and whether all requisite documents and approvals are available or have been obtained. In general, assuming there are no material threshold issues, a listing application for the Main Market will take approximately six months to file with the CMA and then up to a further six months for the application to be processed and trading in the company's securities to commence. However, depending on the circumstances of the issuer, it is not unusual for this process to take much longer. The timeline for the Parallel Market listing process is significantly shorter.
Below is an example timetable for a Saudi IPO listing its shares in the Main Market which reflects the anticipated timing and illustrates the key steps in the IPO process. The timeline has been prepared on the assumption that the process is not delayed or interrupted by a complicated restructuring, complex due diligence issues, difficulties in preparing financial accounts or valuation on a timely basis, and that there are generally no significant threshold issues.