Dubai: In the UAE, the AI tech wave is all set to show up on the IPO boom, with subscriptions opening for Abu Dhabi headquartered Bayanat AI, which has priced its shares at Dh1.1 apiece. Part of the AI- and healthcare-focussed G42 Group, Bayanat AI is on target to raise Dh628 million by listing 22.2 per cent of the company at the time of listing on ADX.
The offer received an instant over-subscription with 'professional investors'. Just over 6 per cent of the total offer has been marked for retail investors. "Bayanat is pleased to announce that it has gathered enough subscriptions to cover the professional investors’ offering of 534.28 million shares," said a statement.
“It gives me great pleasure to bear witness to the show of commitment by our cornerstone investors – Silver Lake and International Holding Company (IHC), as well as other professional investors," said Hasan Al Hosani, CEO. "The overwhelming demand for subscription to Bayanat AI’s IPO is a strong reflection of the confidence investors have in our vision and strong growth trajectory.”
The subscription period will run until October 25, and start of trade on ADX set for October 31. It follows the successful listing of hospital operator Burjeel Holdings and comes amidst market talk of another ‘imminent’ IPO in Dubai.
'The cornerstone agreements reinforce the confidence Silver Lake, IHC and other international investors have in Bayanat, G42 and Abu Dhabi, and opens opportunities for further collaboration and business development," the company said in a statement.
Silver Lake is a US headquartered tech investment firm, with more than $92 billion in combined assets under management. The portfolio companies generate nearly $266 billion of revenue annually.
IHC, meanwhile, had invested in the previous Abu Dhabi IPO, from Burjeel Holdings. IHC hold 15 per cent.
While geospatial solutions remains a core part of Bayanat AI – which G42 acquired in 2020 – what has caught the public – and investor’s - eye is the company’s ‘smart mobility’ solutions that have gone live on Yas and Saadiyat islands. Its solutions are behind the autonomous driving already available and which will be expanded as more of the support infrastructure and regulations click into place.
Pilot projects with 'smart mobility'
“The first level implementation are done while the mass transport system will soon follow in the coming weeks,” said Renyl Rauf, CFO at Bayanat AI. “We are building predictive capabilities around AI to build and operate smart cities, their infrastructure, and even manage energy consumption.
“The autonomous driving initiative at Yas Island was a pilot project, with very few vehicles plying on the streets. There are various steps to the self-mobility process, and the regulator needed comfort about all aspects. This has been delivered by whatever work we have delivered since.”
According to the CFO, the Bayanat AI financials have already seen the boost from the rollout of new solutions.
Bayanat AI revenues were at Dh366.7 million for 2021, up 48 per cent. The gross margin would surely catch attention at a substantial 48 per cent, while EBITDA increased from Dh76.7 million in 2020 to Dh104.7 million. The net margin increased to 30 per cent for the nine-month period ended September 30, 2022, up from 22 per cent year-on-year.
“In the last nine months, our key numbers are running in triple-digits,” said the CFO. “We have developed a model that takes in any data - be it in mapping, personnel, procurement - and combine into an operating model that’s easily replicated. The costs remain the same and these solutions can be deployed across sectors.
We have a good mix of clients, and not dominated by government agencies. The clients extend to real estate, construction, energy, mining, etc.
IPO intent
According to Rauf, it was always part of the plan to take Bayanat AI into IPO at the first opportunity. “After the G42 takeover in 2020, a capital market journey was always the intent. It was last year we started on the process, and it took us some time to get through the detailed analysis. Finally, we agreed to all the key aspects and we are ready to get going.
Through raising new capital, the target is to speed up expansion into the region and even go wider, 'acquire new customer, focus on inorganic growth through buying entities that have tech complementing what we have or even something new."
