(Bloomberg) -- Saudi Telecom Co. plans to spin off its internet-services unit Solutions by STC through an initial public offering on the local stock exchange late next year, according to people familiar with the matter.

The company has already started talks on the IPO with local and international investment banks, but has yet to appoint a financial adviser, the people said, asking not to be identified because the information is private. Saudi Telecom is considering selling as much as 30% of the business, although no final decisions have been made and the company may still decide against selling shares, they said.

While Saudi Telecom does not break out the financial performance of its subsidiaries, the Riyadh-based company did say that Solutions by STC was one of the two key drivers for a 10% increase in revenue for the second quarter, along with its sales and distribution arm, STC Channels.

Saudi Telecom and Solutions by STC didn’t respond to emailed requests for comment.

The potential listing comes as businesses from grocery stores to car rental companies look to sell shares on the Saudi stock market, buoyed by a surge in demand for stocks that has led to one recent offering being 83 times oversubscribed.

The Saudi telecoms firm is also continuing talks to buy Vodafone Group Plc’s stake in Vodafone Egypt, even though a deadline to finalize terms lapsed this week. Saudi Telecom had offered $2.39 billion for Vodafone’s 55% stake in the Egyptian carrier in January.

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