The sale comprises 3.04 billion shares with a base price of 2,857 rials (about 7 cents) per share and will take place on Tehran Stock Exchange’s first market. If the sale pulls through, Saba’s share in MSC will drop to about 1%.
This will be the current fiscal year’s (started March 21) second block sale of MSC’s shares, following Omid Investment Bank’s unsuccessful offering of a 1.69% stake on April 22.
Saba Tamin is a subsidiary of Social Security Organization’s investment arm, Social Security Investment Company, according to Financial Tribune.
Together with its subsidiaries, MSC is the largest flat steel producer in the Middle East and North Africa region and Iran’s largest steelmaker, supplying 20% of the region’s steel demand and accounting for 1% of Iran’s GDP.
MSC had the highest sales among Iranian steelmakers last year, as it sold 158 trillion rials ($3.16 billion) worth of hot-rolled, cold-rolled, coated steel as well as other products during the period under review, up 56.3% YOY.
Saba, a holding with extensive stakes across banking and insurance industries, operates as a financier of SSIC’s eight other holdings and 200 subsidiaries.
Selling the stake in MSC indicates that the financial holding is aiming to streamline its operations. This is in line with SSIC’s plans to downsize its bloated holdings, a number of which have been bogged down with toxic or underperforming assets.
Corporate restructuring is of prime importance for SSIC, as its parent organization SSO has to pay about 750 trillion rials ($19.2 billion) in pension every year, with a sizable chunk of it coming out of SSIC’s revenues.