Abu Dhabi June 6 2024: Abu Dhabi’s first initial public offering of the year drew in orders of $20 billion as appetite for listings in the Gulf remains healthy.
Alef Education’s shareholders will raise 1.89 billion dirhams ($515 million) after the deal priced at 1.35 dirhams per share, the top of the range. That implies a market capitalization of 9.45 billion dirhams. The offer was 39 times covered by local, regional, and international investors, according to a statement on Thursday.
Tech Nova Investment – Sole Proprietorship LLC and Kryptonite Investments LLC are offering 1.4 billion shares, or a 20% stake, in the education technology firm.
Despite the lull in IPOs on the Abu Dhabi market this year so far, other countries in the region, such as Saudi Arabia, have seen more activity. Four Saudi companies have drawn a combined $176 billion in orders for their IPOs.
Founded in 2016 and indirectly majority owned by Abu Dhabi Capital Group, Alef Education serves the kindergarten to 12th grade sector. It operates in countries including the United Arab Emirates, Indonesia, Morocco and the US and plans to expand both organically and inorganically.
Alef plans to pay investors a dividend of at least 135 million dirhams for this year and 2025, it said.
First Abu Dhabi Bank PJSC and EFG Hermes are the joint lead managers and joint bookrunners on the IPO.
Parents in the UAE are among the world’s biggest spenders when it comes to educating their children. Dubai’s emergence as a post-Covid haven has drawn newcomers to the emirate, where private schools are mandatory for expatriate children.
Private school operator Taaleem Holdings, which listed in Dubai at the end of 2022, initially saw its shares fall below the offer price, but they are now trading 22% higher as profit rose on higher student enrollments.
