Saudi Arabian Contractor MGC Is Said to Explore Riyadh Listing

(Bloomberg) -- Saudi Arabia’s Mutlaq AlGhowairi Contracting Co. is weighing an initial public offering in Riyadh, according to people familiar with the matter, which could add to a wave of listings in the kingdom that’ve raised over $10 billion in the last two years.

The firm, known as MGC, is exploring a deal that could value it in the range of about 12 billion riyals ($3.2 billion) and 15 billion riyals, according to the people, who declined to be identified as the information is confidential.

Moelis & Co. is acting as a financial advisor on the potential transaction, while Al Rajhi Capital is arranging the deal, according to some of the people. MGC is also seeking to add more banks to the offering, which could launch as early as next year, one person said.

Discussions are preliminary, with no final decisions on the timing or size of the offering, and the firm may ultimately choose not to proceed.

Representatives for MGC did not respond to requests for comment. Al Rajhi Capital and Moelis declined to comment. Al Rajhi Capital’s role was first reported by local news outlet Argaam.

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MGC develops water and road infrastructure, with clients including Neom, the futuristic desert city project, and several Saudi government ministries, according to its website. Like other contractors, the firm stands to benefit from a national push to expand water desalination and distribution networks in Saudi Arabia.

Saudi Arabia has been the Middle East’s most active market for IPOs this year, with firms raising about $3.5 billion. Still, performance has been uneven as investors scrutinize valuations amid a subdued oil price environment.

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