Dubai: It’s the share buyback season in the UAE and Gulf stock markets, with DFM-listed investment firm Amanat being the latest. The company, which is launching a dedicated healthcare entity, plans to buy back up to 5 per cent its capital.
Not only that, it will do so at a premium – Dh1.08 a share - to its current trading price of Dh0.95. The offer price is also close to its 52-week high of Dh1.09.
Share buybacks have not been hugely popular in the UAE/Gulf markets, even in instances where the stocks have had tepid investor support and more or less remain unchanged. But with three companies in the Gulf currently running some buyback programme, things are changing.
Apart from Amanat, there is Gulf Finance House of Bahrain and the Dubai-headquartered, FTSE-listed payment processing firm Network International, with the latter in the midst of a $100 million spent on the buyback. Network is currently fielding a takeover bid from CVC Capital Partners.
The GFH Financial Group, meanwhie, acquired another 1.92 million of its shares, increasing its total holding of treasury shares to 271.99 million and representing 7.10 per cent of the total issued as of April 17.
In a statement, Amanat's Chairman Hamad Abdullah Alshamsi said the buyback 'underscores our belief that Amanat’s shares are attractively priced and offer a compelling investment opportunity, highlighting our confidence in our business model and growth trajectory.
“Going forward, we continue to see significant opportunities to leverage Amanat’s core capabilities in investment sourcing and platform development to unlock further growth and deliver additional value for our shareholders."
To fire up its stock, Amanat has also announced a Dh100 million dividend, amounting to 4 fils per share or 88 per cent of its profit for 2022. "The doubling of our dividends from pre-2020 levels reflects our commitment to delivering value for our shareholders through a combination of growth and a higher dividend payout,” said Alshamsi.
Amanat’s education platform includes NEMA Holding as well as Middlesex University Dubai, and the Human Development Company in Saudi Arabia. Plus, it holds the real estate assets of the North London Collegiate School in Dubai.
On the healthcare side, the assets include Cambridge Medical and Rehabilitation Center; Sukoon, which is a provider of long-term and post-acute care services in Jeddah; and Al-Malaki Specialist Hospital in Bahrain.