Trowers & Hamlins act as lead counsel on most successful IPO in Bahrain in a decade

February 2019

Trowers & Hamlins has acted as lead counsel on an Initial Public Offering (IPO) hailed as Bahrain’s most successful in 10 years.

The transaction originally comprised an offering of 18 million shares, but generated a total demand of 97.4 million shares or BD64.3 million between both the institutional and retail investors, resulting in an oversubscription by 5.4 times the offer size.

The original offer price placed valuation on the issuer at c.$160m. The share price then increased by c.20 per cent in the first week after it was listed on the Bahrain Bourse.

The Trowers team, led by partners Brian Howard and Tom Reynolds, drew together the firm’s expertise in capital markets, logistics infrastructure and corporate structuring. The project required co-ordination with the Ministry of Transport and Telecommunications, the Bahrain Bourse, the Capital Markets Supervision Directorate of the Central Bank of Bahrain, the Ministry of Industry, Commerce and Tourism and the Directorate of Ports and Maritime Affairs.

Partner Brian Howard commented, “We are delighted to have acted on this important development for APM Terminals Bahrain B.S.C., Bahrain’s capital markets and the Bahrain economy generally and extremely excited about the increased prospects for new issues coming to the Bahrain Bourse, both on the main market and the nascent Bahrain Investment Market.’

The fully underwritten IPO included a new ‘participating broker offering’ feature (B-IPO) and is the first electronic IPO in Bahrain utilising a web-based subscription platform (E-IPO). The firm helped develop the specific legal framework for the utilisation of these new platforms within the IPO which encouraged a significant majority of the subscribers.

The IPO was the first to be conducted under the new dual application process under the proposed listing rules and offering of securities module. It also included the first election of directors to a public company in Bahrain utilising the cumulative voting mechanism which became mandatory for all elections of joint stock company directors after June 2018.

The IPO satisfied the requirements of the concession agreement for the operation of Khalifa Bin Salman Port drafted by Trowers & Hamlins more than 12 years ago. Despite the changes in legislation and associated processes applicable to the IPO during 2018, the IPO met the timetables agreed with the concerned regulatory bodies at start of year. The Trowers team worked with Hassan Radhi and Associates which acted as Bahrain legal counsel to the IPO.

Mark Hardiman, the CEO of APM Terminals Bahrain B.S.C., noted, “We are pleased to have selected Trowers & Hamlins as our legal partners for this IPO. Their depth of experience in these transactions shines through and helped to deliver the IPO’s success.”