• Saudi’s Tadawul subsidiaries launch a new CMS platform and Edaa Connect to streamline IPOs and enhance investment accessibility.
• CMS simplifies IPO processes, reduces administrative burdens, and accelerates market access, benefiting investors, financial institutions, and capital market growth.
• Edaa Connect expands mutual fund access, integrates fund options, and provides enhanced tools for fund managers to optimize operations and visibility.

What happened? Recent announcements in Saudi Arabia have made it easier for companies to go public and for investors to access new opportunities. 

The Saudi Exchange Company, subsidiary of the Tadawul Group announced the launch of a new capital management system (CMS). Meanwhile, the Saudi Depository Center, also part of the Saudi Tadawul Group, announced the launch of its new platform Edaa Connect.   

Capital Management System

How does this change the IPO process? The CMS platform is designed to enhance efficiency, transparency and effectiveness in the initial public offering (IPO) process within the Saudi capital market. 

Mohammed Al-Rumaih, CEO of Saudi Exchange told Arab News, “It’s a revolutionary system that will serve three main goals. One, make it quicker for companies to do their IPO, also cheaper for them and as well, open the opportunity for a bigger set of investors, so it used to be only for receiving banks, usually for three.”

For investors:  The new platform aims to allow them to subscribe directly through their investment portfolios in order to eliminate the need to open new accounts. This streamlines quicker access to more investment opportunities, enhances investment flexibility and decision making. Additionally, this expansion aims to further develop the Saudi Capital Market and increase its attractiveness to investors.

For issuers: CMS aims to shorten the time required to access the market enabling them to list their financial securities more efficiently. It also allows them to reach a broader investor base, which increases the likelihood of a successful offering and boosting demand for IPOs. 

CMS aims to shorten the time needed to access the market so that issuers can list their financial securities more efficiently. Thus, allowing them to reach a broader investor base in order to increase demand for IPOs and support the likelihood of a successful offering.

For financial institutions and subscription managers:  CMS aims to provide more flexibility in managing IPO processes. This is through reducing administrative burdens, streamlining subscription workflow and improving their operational efficiency.

Edaa Connect

Saudi Depository Center, part of the Saudi Tadawul Group, announced the launch of its new platform Edaa Connect. 

What is this? Edaa Connect serves as a comprehensive platform for mutual fund investments. 

Hanan Mohammad Alshehri, CEO of Edaa, said: “This innovative platform will revolutionize portfolio management and decision-making, streamline the investment process, and deliver unparalleled efficiency. Aligned with the Financial Sector Development Program’s objectives, Edaa Connect will significantly enhance the investment experience and support the ongoing development of the Saudi capital market.”

For investors: The platform aims to expand access to investment opportunities in funds within the Saudi financial market.  Furthermore, it aims to provide a more seamless investment experience, integrating various fund options to simplify subscription and redemptions for investors.

Edaa connect aims to widen its focus on funds not listed on the Saudi Exchange which allows for a more comprehensive and tailored experience for investors. Thus, enhancing the usability and relevance of the mutual fund markets for wide-range of participants.

For Fund Managers: The platform aims to not just be beneficial for investors but also for fund managers. Furthermore, it offers them enhanced tools to manage their operations while also giving funds greater visibility and access to a broader investor base. This will work towards leveling the playing field within the mutual fund market

Additionally, it aims to equip fund managers with enhanced tools to manage their operations.
Why is all of this important? Saudi’s new financial platforms aim to enhance market efficiency, streamline IPO processes and expand investment access. This is to strengthen their market’s appeal to global investors and support broader market participation.