Arabian Dyar pauses listing as market mood sours

Saudi Arabia’s Arabian Dyar has put its planned Tadawul initial public offering on hold, becoming the latest issuer to step back from the Kingdom’s listings pipeline as volatile trading conditions and weaker investor appetite complicate efforts to bring larger private companies to market.

The real estate and construction company, formally known as Aldyar Alarabiya Real Estate Development Company, had faced a June deadline to complete the offer after securing approval from the Capital Market Authority at the end of December. That approval covered the registration and sale of 97.5 million shares on the Saudi Exchange’s main market, equal to 30 per cent of the company’s capital of 325 million shares.

The decision to defer the transaction reflects a tougher environment for issuers seeking premium valuations. Arabian Dyar had been aiming for a valuation of about SAR16 billion, a level viewed by some advisers as demanding against a backdrop of selective demand, geopolitical uncertainty and uneven performance across regional equities. The company is not cancelling its long-term capital-market ambitions, but the timing has become less favourable for a deal requiring strong institutional support.

The pause comes despite a sizeable business profile. Arabian Dyar’s investment portfolio has been estimated at about SAR15 billion, anchored by the Dyar Al-Haram project in Makkah, which is being developed in phases with investments of about SAR10 billion. The company has also pursued expansion around high-profile urban projects, including an agreement with Umm Al-Qura for Development and Construction to reserve land at the Masar destination for a residential tower involving investment of around SAR700 million and more than 300 residential units.

A listing would have given investors exposure to the Kingdom’s real estate development cycle at a time when major housing, hospitality and religious-tourism projects remain central to Vision 2030. Yet the same scale that made the company attractive also increased scrutiny over pricing, execution risk and the sustainability of earnings in a sector exposed to funding costs, land values and construction delivery schedules.

Market conditions have become harder to read. The Tadawul All Share Index rose 1.3 per cent on Tuesday to 11,115.37, helped by gains in heavyweight financial stocks, but the rebound followed a period of choppy trading linked to regional tensions and wider caution in Gulf markets. The benchmark had ended 2025 down 12.8 per cent, its sharpest annual percentage fall since 2015, leaving investors more sensitive to valuation discipline and aftermarket performance.

Saudi Arabia remains the Gulf’s busiest IPO market, but demand has become more selective. Thirteen main-market IPOs in 2025 raised about SAR14.5 billion, broadly in line with the previous year’s SAR14.2 billion, yet the headline figures masked a shift in investor behaviour. Buyers have shown willingness to support well-priced transactions with clear growth stories, while larger deals seeking aggressive valuation multiples face more resistance.

Arabian Dyar is not the only company reassessing timing. Quick-delivery platform Ninja has been testing investor appetite, including meetings with investors in London, but has not yet decided whether to proceed with a listing that could raise about $1 billion in late 2026 or early 2027. The company has appointed major international and local banks as advisers, signalling continued interest in public markets even as timing remains uncertain.

Other issuers are still moving ahead. Mutlaq Al-Ghowairi Contracting Company has been preparing to sell 240 million shares, representing 30 per cent of its share capital, on the main market. Its offer is structured across institutional and retail tranches, with book-building and subscription windows designed to meet regulatory timelines. The contrast shows that the Saudi IPO market is not closed, but pricing and sector positioning have become decisive.

For regulators and market operators, the shelving of Arabian Dyar’s offer is a reminder that a deep pipeline alone cannot guarantee execution. Saudi Arabia has spent years widening participation in its equity market, encouraging private-sector listings and using the exchange as a channel for economic diversification. The next phase may depend less on the number of approvals and more on whether issuers are prepared to accept valuations that leave room for investors after listing.