Saudi PIF seeking Elm Public Offer

By Rahul Vaimal, Associate Editor
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Saudi Arabia’s sovereign wealth fund is contemplating an initial public offering of its information security company Elm. The $300 billion Public Investment Fund has sent banks a request in recent weeks to come up with proposals on how to go ahead with a sale of Elm shares to the public. It was not immediately clear how big the deal would be.

Saudi Public Investment Fund plans to sell up to 30% of the company in an IPO, which would be “mid-sized” while investors should expect more of an exit strategy by the fund overcoming period.

Elm is fully owned by the PIF and provides secure e-business services and information technology and project support services and government project outsourcing in Saudi Arabia, according to information on its website.

The sovereign wealth fund’s request for proposal (RFP) had asked banks to offer a bid bond, a debt instrument secured by a bidder, and a performance bond, which is a bond issued by a bank or other financial institution. Though the deal is unlikely to take place before next year.

Last year Elm engaged in the series A+ round of financing for Syarah, an online marketplace for buying and selling cars in Saudi Arabia.

The recent step can be seen as Saudi Arabia’s longterm strategy to build an international portfolio of investments and investing locally in projects that will assist reduce Saudi Arabia’s dependence on oil.

Last year, the PIF’s recycling unit acquired a 100 percent stake in Saudi firm Global Environmental Management Services and the fund said it intended to raise its stake in ACWA Power to 40 percent from 25 percent.

The head of the fund, Yassir al-Rumayyan, said last month there would be plenty of potential for investment opportunities once the coronavirus crisis passes.