Riyadh – Mubasher: Saudi Telecom Company (stc) has asked international and local banks to pitch for roles in a potential initial public offering (IPO) of its products and services development arm, Solutions by STC (STCS), Reuters reported on Tuesday citing three sources familiar with the matter.

Saudi Arabia’s largest telecoms operator sent a request for proposals to lenders last week but did not communicate with banks its planned deal size.

Last year, STCS achieved over SAR 5 billion ($1.33 billion) of revenues and profits of around SAR 500 million.

The company’s valuation could be around SAR 9 billion ($2.4 billion), if it garners 18-20 times its earnings multiples, one of the sources said.

The IPO size could be around $500 million if the company sells 20%, the source said.

The GCC nation is encouraging more companies to list in a bid to deepen its capital markets under reforms aimed at reducing its reliance on oil.