Oman Investment Authority pursues largest IPO to boost economic diversification

The Oman Investment Authority (OIA), which serves as the sovereign wealth fund of the Sultanate of Oman, has formally announced an Initial Public Offering (IPO) for 25% of the shares of OQ Exploration & Production, a wholly owned subsidiary of OQ Group under the OIA’s management.

This IPO is poised to establish a significant milestone as it is expected to be the largest in Oman’s history, taking place on the Muscat Stock Exchange.

According to industry sources, the allocation of shares in this IPO is strategically divided, with 60% designated for institutional investors, both within Oman and internationally, while the remaining 40% will be accessible to individual investors. The structure of this IPO adheres to Shariah compliance, which underlines its alignment with Islamic financial principles and practices.

This move is a component of the OIA’s overarching divestment strategy, which was introduced in mid-2022. Since that announcement, OIA has successfully realised over USD 2.5 billion from 12 divestments spanning across the years 2022 and 2023. These divestments encompass nine private placements across various sectors, as well as three earlier IPOs on the Muscat Stock Exchange, namely The Pearl REIF, Abraj Energy Services, and OQ Gas Networks, which witnessed considerable oversubscription, highlighting robust investor confidence.

The OIA continues to focus on divesting select subsidiaries, aiming to transform them into public joint-stock companies or engage in direct equity sales to strategic investors. This endeavour is part of a broader initiative to invigorate the Omani economy and enhance the profile of the Muscat Stock Exchange, simultaneously striving to position Oman as an emerging market. By publicly listing government-owned assets, the OIA is dedicated to improving governance, ensuring transparency, and adopting global best practices, all of which form part of Oman’s economic diversification objectives.

Moreover, this strategy is designed to empower the private sector, thereby playing a significant role in stimulating the national economy. It creates valuable investment opportunities for both citizens and residents, while also aiming to attract high-calibre foreign investments. In response to the dynamic global economic landscape, the OIA has reviewed and updated its divestment strategy for the upcoming five-year period (2025 to 2029). This updated plan includes the establishment of steering committees within its subsidiaries, thereby ensuring the efficient management of divestment operations. The OIA anticipates divesting approximately 30 investments, either through public offerings in sectors such as energy, logistics, utilities, and infrastructure or through direct sales to strategic investors in sectors including aquaculture, agriculture, and mining.

With a portfolio spanning more than 30 countries, the OIA’s core objective is to maintain its competitive edge in the rapidly evolving global economic environment, thereby fortifying the national economy and enhancing Oman’s global competitiveness. By implementing progressive economic policies, the OIA aims to create new investment opportunities that align with Oman’s Vision 2040, which seeks to promote economic diversification, attract foreign direct investments, and foster synergetic partnerships with local enterprises in order to drive sustainable economic prosperity for the Sultanate of Oman.