While private equity is catching the main headlines, public equity is proving it is far from dead.
The past week has seen announcements that Kingdom Holding, part owner of the Four Seasons chain, is to list on the Saudi stock exchange, and Asian upscale group Shangri-La is raising almost $700m to fund growth.
The Kingdom IPO is more symbolic than functional in that just 5% of the company is being offered raising $860m. The market value of the group is $16.8bn.
After listing on the Tadawul (Saudi stock market), Prince Alwaleed and his dependents will still own about 95% of the company.
About half of the shares offered are to go to individual investors but there has been some resistance with Saudi Arabia because some of Kingdom’s businesses are regarded as un-Islamic, notably Citibank, for charging interest, and Four Seasons, for serving alcohol.
Some clerics have even labelled Alwaleed as the “depraved Prince” for these reasons, despite his status as the world’s 13th richest man according to Forbes magazine. The criticisms are expected to have an effect but the offer is still expected to succeed.
Meanwhile, Shangri-La, controlled by Malaysia’s richest man, Robert Kuok, is hoping to use the cash it raises from its own listing to grow in North America and Europe as well as its home territory of China.
The Hong Kong listed chain, the largest by market value in Asia, currently has 19 hotels in China and wants to double that number by 2010.