ALEC’s Dubai IPO: Dh500 million dividend policy, Saudi expansion plans – What you need to know

Dubai: UAE construction giant ALEC Holdings, on Monday, announced plans for an initial public offering on the Dubai Financial Market, marking the end of 26 years as a private company with what CEO Barry Lewis called “an exciting point in the next chapter of ALEC Holdings.”

The company revealed a massive project backlog of Dh35.4 billion during a press briefing on Monday, with 87 per cent of projects located in the UAE and 13 per cent in Saudi Arabia, positioning the firm strongly for future growth across both markets.

The projects include – Wynn Al Marjan, Stargate Data Centre, and the iLMI – Science Discovery Innovation Centre MISK in Saudi Arabia. Here is all you need to know about ALEC Holdings' IPO.

ALEC reported robust financial results that underpin its public listing ambitions. The company achieved revenues of Dh8.1 billion in 2024 with an EBITDA margin of 8 per cent and a net income margin of 4 per cent.

“The H1 2025 results are very strong, with the revenue of 5.36 billion with an EBITDA margin of 8.2 per cent and a net income margin of 4.5 per cent," said John Deeb, the company’s CFO.

The company has maintained profitability for 18 consecutive years, with Lewis saying: “Going back for the last 18 years, we’ve been profitable every year. We had one slight reduction in 2017 when there were potential issues in Qatar, which made it difficult for us to continue working in that market.”

ALEC unveiled an aggressive dividend strategy that signals confidence in future cash flows.

"From the 2025 financial year, we will pay a Dh200 million dividend. For the ‘26 financial year, we will pay a Dh500 million dividend partly in October and the balance in April. Then we commit to a minimum dividend of 50 per cent of net profits thereafter," Deeb announced.

The company’s dividend policy reflects what Deeb described as “our prudent approach to our capital allocation, so balancing our working capital and CAPEX requirements and also rewarding our shareholders.”

The construction firm identified data centres as a key growth driver, with Lewis highlighting the sector’s massive potential. "The information that’s available in the market is saying that it’s a sector that’s worth potentially over 300 billion in the foreseeable future," he said.

ALEC recently secured the Stargate data centre project in Abu Dhabi worth Dh5.3 billion, demonstrating its capability in this high-margin sector. "The data centre space is an exciting space where you potentially can get a higher margin than operating in some of the other sectors," Lewis explained.

The company has established a significant presence in Saudi Arabia, targeting projects of national importance. “Our strategy was to target Riyadh, and then we also target some of the key projects that are very much part of the vision,” Lewis said.

When questioned about cost-cutting impacts in the kingdom, Lewis remained optimistic: “Today, we have not seen any impact on the areas where we operate and the projects that we have in the pipeline.”

The Saudi market represents what Deeb called "far bigger" opportunities, with “about Dh4.7 trillion” in addressable projects compared to the UAE's Dh2.8 trillion market.

The offering will consist of 1 billion ordinary shares representing a 20 per cent stake, structured as a 100 per cent secondary sale by majority shareholder Investment Corporation of Dubai (ICD). The IPO features three tranches: individual investors, institutional investors, and eligible employees.

“The timeline, as you're aware, we posted the idea today, September 23 should get the price range and start subscriptions. September 30 will be close of subscriptions tranches. First of October should be the final couple of pricing announcements, and then October 15, we expect to list it,” he said.

ALEC operates nine integrated businesses spanning construction, energy, MEP services, and specialised sectors. "What allows these businesses to be successful is that they feed off the platform created by our two principal businesses,” Lewis explained.

The company has executed landmark projects, including 26 pavilions at Expo 2020, major airport terminals, and complex developments like the Arabia theme park in Saudi Arabia for Qiddiya.

Lewis, who has been in the region for over 24 years as a founding member, emphasized the company's selective approach: “We're very selective about what we tender on, and we try to limit the number of projects we tender on to increase our chances of success rate.”

The IPO represents ICD's partial exit while maintaining majority control. Lewis said, “ICD intends to remain majority shareholder in the business.”