Stock - Al Ansari
Demand from retail investors prompted Al Ansari to go with a higher stake for them. Image Credit: Gulf News Archive

Dubai: Al Ansari Financial Services has increased the size of the retail component of its IPO to 7.5 per cent from 5 per cent, given the scale of demand that the offer generated. The retail subscription for the IPO closed yesterday (March 23).

The retail subscription closed yesterday (March 23), while that for qualified investors ends later today.

The overall float size remains at 10 per cent, which means that the stake sale for qualified investors was reduced.  There had been talk among analysts about the possible rejigging of the stake mix for retail and qualified investors. They said that retail subscriber interest was heavy from the moment the IPO opened, but there were heavy distractions from the global markets about the Credit Suisse turmoil playing right through.

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"UAE investors, retail ones especially, will likely park short-term funds closer to home, especially with companies promising steady dividends," said an analyst. "UBS buy and central bank moves have settled nerves over Credit Suisse, but the global markets are still on edge. This will reshape what investors will put in and where."

Stake resized

With its IPO, Al Ansari resized the qualified investor offer to 693.75 million shares from 712.5 million, equivalent to 92.5 per cent of the total shares on offer and down from 95 per cent.

Price range

Al Ansari had set Dh1-Dh1.03 a share as the range, which means the retail tranche will be between Dh56.3 million and Dh57.9 million, representing 7.5 per cent of the IPO size.

The funds raised will go directly to the selling shareholder. The final offer price is expected to be announced on or around March 27 and the listing on DFM on April 6.

The Al Ansari listing is a major inflection point for the local stock market, as its entry into DFM sets up more family-owned businesses to consider going public. A market leader in the UAE remittance market, Al Ansari has ambitions of spreading the network far and wide in the Gulf.

What next for UAE IPOs?

"The Ramadan phase should give a breather on the next IPO announcements - that will also give the companies involved and their bankers some direction on where global markets are headed post-Credit Suisse," said an analyst. "But one thing is clear - retail investor interest is high in the UAE and Gulf and these investors are looking for the best IPO possibilities."

On ADX, Presight AI from the G42 Group will list early next week after a quite successful IPO. It will join peer entity Bayanat AI on the index.