Saudi airline sees catering unit IPO by end-2011
Riyadh, June 21, 2011
Saudi Arabian Airlines expects to hold the delayed initial public offering for its catering unit by the end of 2011, its director general said on Tuesday.
The IPO, which analysts estimate to be worth between $400 million and $540 million, was initially planned for the third quarter of 2010 and was postponed to the second quarter of this year, but was again delayed, awaiting regulatory approval.
"For the catering unit, we expect to be done with the initial public offering during this year," director general Khaled al-Molhem told Al Arabiya television.
Separately, an airline spokesman confirmed a newspaper report that the national carrier is planning to acquire 35 new planes by 2018.
"Now we are still identifying what kind of aircraft to use, and we are in negotiations with different companies such as Airbus , Boeing and other choices, and also the way to finance it, whether special order or leasing," Abdullah al-Ajhar told Reuters by telephone.
The Saudi national carrier started a process of privatisation in 2006 by dividing the company into six units -- catering, cargo, maintenance, airlines, flight academy and ground handling.
It plans to privatise each of these units individually and offer them to the public. The catering unit was the first to be privatised through private placement in 2008. It is now awaiting regulatory approval to offer 30 percent to the public. French bank Credit Agricole is advising on the IPO. - Reuters