​In continuance to the CMA role to regulate and develop the capital market, and aiming to facilitate financing by providing financing sources, and encouraging investments by increasing the market attractiveness for investors and ease the investing ways, and in pursuance to the Authority's program "to Achieve Saudi Vision 2030", and based on the Capital Market Law issued by the Royal Decree Number (M/30) Dated 02/06/1424H, the CMA Board has issued its resolution to adopt the updated Instructions of Book Building and Allocation in Initial Public Offerings (IPOs), and that it shall be affective from the its publication date.

It's worth mentioning that the most significant aspects in which the updated Instructions of Book Building Process and Allocation in IPOs is aiming for, which when prepared, the views and opinions of interested persons, specialists and related parties where obtained, are to widen the scope of the participating parties in book building which will increase the pricing efficiency. The categories participating in the book building process were expanded to include the GCC national investors of legal personality. The amendment draft also attended to lifting some of the restrictions related to determining the price range and the full coverage of the offering by the participating parties. Moreover, the amendment draft included the change of the mechanism of determining the subscription price by allowing the financial advisor in coordination with issuer to determine the subscription price according to the supply and demand forces, with consideration to a number of other controls which will ensure the investors protection. The amendment also aimed at changing of the mechanism of share allocation by allowing more flexibility into it, leading to the increase of the market efficiency.

And the instructions draft can be viewed through the following link:

InstructionsBookBuildingAllocation