STC reportedly took a step forward in the potential IPO of its products and services arm Solutions by STC, by hiring banks to arrange the sale of shares in the subsidiary.
Reuters reported the Saudi operator appointed HSBC, Morgan Stanley and local lender National Commercial Bank to support the sale according to anonymous sources.
The IPO of Solutions by STC could be worth around $500 million if the company sells a 20% stake in the company, with the valuation of the company potentially at SAR9 billion ($2.4 billion) if the sale garners 18-20 times its earnings. It was noted the division is profitable and was a key driver for a boost in the company’s Q2 results.
The arm provides ICT services to companies in need of big data analysis; IoT, cybersecurity; managed services; cloud computing and system integration.
During speculation of the sale, STC is currently attempting to buy a majority stake in Vodafone Egypt, a sale which had been delayed.
The Saudi operator missed a deadline last week to finalise terms but Vodafone Group stated the two are still in negotiations for the sale. STC was reportedly seeking a reduction to its non-binding $2.39 billion bid for Vodafone Egypt.