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Saudi bourse to open doors to smaller foreign funds

Saudi Arabia, November 26, 2017

Saudi Arabia's securities regulator is planning to ease requirements for foreign institutional investors - with a minimum of SR1.875 billion ($500 million) assets under management - into the stock market, said a report.

The Capital Market Authority (CMA) move comes at a time when Saudi Arabia seeks to draw more capital into the market before the listing of state oil giant Saudi Aramco, reported Reuters.

The CMA had opened the bourse to direct investment by qualified foreign institutions in 2015. It reduced minimum requirements for the institutions last year and is now proposing a fresh round of reforms, giving the public 14 days to comment on the proposals.

Among the reforms, the minimum value of assets under management needed for an institution to qualify as an investor would fall to SR1.875 billion ($500 million) from SR3.75 billion.

The number of foreign funds operating in Saudi Arabia could affect the government's plan to sell about 5 percent of Aramco next year, potentially raising some $100 billion, according to authorities' valuation of the company. It could be the world's largest-ever initial public offer of equity, it added.

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