Dubai's Al Ansari Financial Services IPO pulls Dh12.7b as subscriptions, dividend yield at 7.8%
Retail investors make up heavy presence as Al Ansari targets 7.8% dividend yield
Dubai: The family-owned Al Ansari Financial Services' IPO saw subscriptions hit Dh12.7 billion, with the final offer price set at Dh1.03 per share, which is at the top end of the price range. The company, which will list on DFM April 6, last week confirmed it was adding to the stake that retail investors will be getting - and demand from this category proved quite significant.
The final stock price implies a market cap of Dh7.73 billion (or $2.1 billion) on listing at DFM. The Dh12.7 recorded by way of over-subscription saw Gulf-based investors joining in, and there was also National Bonds signing up to be a cornerstone investor. The over-subscription tally is 22x (excluding the cornerstone tranche).
The subscription numbers were achieved 'despite recent global market gyrations'. True, it's been an exceptionally trying time for stock markets, first with the Credit Suisse fallout and then the volatility set off by concerns related to Deutsche Bank.
The company was floating 10 per cent via the IPO. “The remarkable investor interest we drew from across the UAE, regional and international investors demonstrates the strong brand reputation that Al Ansari Financial Services has built over its long and rich history," said Mohammad Ali Al Ansari, Chairman of Al Ansari Financial Services. "It is also a testament to the attractiveness of the UAE and wider GCC economies and the investment community’s confidence in Dubai’s public equity markets and the DFM.”
Al Ansari - which raised its retail investor tranche to 7.5 per cent from 5 - will take on the mantle of being the debut listing on DFM in 2023. On ADX, ADNOC Gas has done so and the G42-owned Presight AI will join shortly.
The Al Ansari UAE retail dffer drew more than Dh2.5 billion as orders, with the total number of applications at nearly 15,000.
Tap into remittance industry growth
At the final price, Al Ansari's dividend yield will be a minimum 7.8 per cent. "We are offering investors an opportunity to be part of a business that has significant growth opportunities driven by the UAE and other GCC countries’ favourable macroeconomic and industry trends," said Rashed Ali Al Ansari, Group CEO. "At the same time, the Group plans to reward its shareholders through generous dividend distributions."
In the UAE, Al Ansari's market share in the remittance space is estimated to be in the mid-20 per cent range. Kuwait is the other market where the company has a presence, and it is now trying to up its direct equity stake in the entity there. Which will be the next market it seeks to make entry and how soon that will be form the basis for the next round of growth at Al Ansari.
"As a publicly listed company, we intend to further build credibility and increase transparency with existing stakeholders, as well as attract new partners and enter new markets with greater confidence and ease," said Rashed.