SAUDI AIRLINES UNIT PICKS HSBC FOR PLANNED IPO -SOURCES

DUBAI,UAE   :  Saudi Ground Services, a unit of national carrier Saudi Arabian Airlines, has hired HSBC Holdings to advise it on a planned initial public offering (IPO) of 30 percent of its shares, banking sources told Reuters.

The unit would be the second of six - including catering, cargo, maintenance, airlines and flight academy - to pursue a stock market listing following Saudi Arabian's decision in 2006 to privatise them.

One banking source, however, said the ground services unit may not list until early 2013, with another saying it could be much later.

The first of the units to be sold publicly, Saudi Airlines Catering Co, raised $347 million after completing a 30-percent IPO in July. Its shares have risen 14.5 percent since then.

"Ground services can be a very profitable business but it depends on the country and the set-up," a senior equity banker said, pointing to the contrasting profitability of handlers at airports with multiple firms, such as London Heathrow, and those, such as Dubai, which are run as monopolies.

10/09/2012  :  Reuters USA.

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