Saudi consultancy TAM eyes IPO to drive next phase of growth

03 March 2023 3 min. read

TAM has announced plans for an initial public offering, as the Saudi-based management consultancy firm looks to supercharge its growth plans.

Launched a decade ago in Saudi Arabia, TAM is a digital solutions and management consulting company. Based in the capital city of Riyadh, the firm is part of a national consulting market that is riding high – driven by strong demand from the country’s national economic development project: Vision 2030.

With TAM’s client base predominantly made up of the Saudi government, government-related entities and the sovereign wealth fund Public Investment Fund, the firm anticipates continued growth – and is now turning to a public listing to fuel its agenda.

Saudi consultancy TAM eyes IPO to drive next phase of growth

As reported by Bloomberg, the Saudi Capital Markets Authority (CMA) has approved TAM’s application to list 585,600 shares – or 16% of its share capital – on the Nomu-Parallel Market (Saudi Arabia’s parallel equity market with lighter listing requirements than the Tadawul exchange).

Welcoming the decision, the CEO and Founder of TAM, Abdullah Youssef, commented: “We are seeing growth double annually as the Vision 2030 reforms expand, and partnerships with government entities increase. We proudly welcome and appreciate the CMA’s approval of our application and we look forward to progressing our IPO in the months ahead.”

In the world of consulting, going public is not a common vehicle for landing growth funding, with most consulting firms turning to strategic alliances, private equity or private-held partner funds instead. In the case of TAM, the firm is seeking the backing from institutional and retail investors, opening up a relatively small portion of its stock in the process.

Reporting by Bloomberg suggests that TAM’s roadshow is shaping up nicely, with the firm billed as “an attractive prospect” on the back of its close ties with leading high-ranked Saudi officials and differentiated homegrown offering.

Abdullah Youssef, CEO and Founder of TAM

No disclosure has been provided on TAM’s possible valuation, although CEO Youssef did confirm that the firm will price itself based on a strong forward-looking growth agenda. Having already booked multiple contracts for the current financial year, TAM is forecasting over 20% revenue growth in 2023. TAM already more than doubled its year-on-year revenues over the past three years.

“We still have very high growth prospects over the next two years, but we’re not planning to go to the market with a crazy valuation,” said Youssef.

If the IPO round closes as expected, TAM will channel some of its funding to drive a diversification strategy. Building on its expertise gained in the government sector, TAM aims to expand in Saudi Arabia’s burgeoning private sector as well.

According to a recent analysis by Strategic Gears (another homegrown Saudi consultancy), the Kingdom is expected to be a sweet spot for growth in 2023, while the global landscape remains subdued. Another study, by Deloitte, found that Saudi family businesses – the engine room of private sector growth – are the most optimistic across the GCC region.