United Arab Emirates-based Amanat Holdings, a healthcare and education start-up, will launch its 1.375 billion dirham ($374 million) initial public offer next Monday, it said in a statement on Wednesday.
The offer period for the flotation, in which 55 percent of the company will be sold to investors at 1 dirham a share, will run until Nov. 4, said the statement issued at a media event.
Amanat is the latest company to go public in the United Arab Emirates, aiming to take advantage of a wave of optimism driving the first listings after a near-five year hiatus in major initial public offerings in Dubai and Abu Dhabi.
It follows the $1.58 billion flotation of Emaar Malls Group which drew orders worth more than $47 billion although the level of excitement from both investors and new companies without a track record have raised concerns about an overextension damaging the nascent market.
The euphoria around IPOs in the Middle East contrasts with the picture in Europe, where a string of companies have had to pull their listings this month, blaming tough market conditions.
Amanat’s chairman, Faisal bin Juma Belhoul, dismissed the concerns about greenfield companies – who use a flotation to raise their initial capital – listing now in the UAE, insisting it had the strategy and experience to match the success of Emaar Properties, Dubai’s largest firm by market value.
“Emaar was a greenfield company with a creative strategy and vision and is today one of the leading companies in its sector globally, so we are hopeful Amanat can follow similar footsteps in being a pioneer in healthcare and education in the region and potentially globally,” Belhoul told reporters at the event.
Amanat will use 70 percent of the funds from the IPO to invest in healthcare and education, expecting to buy stakes in three to six companies in the next 12-24 months, Belhoul said.
The company is targeting majority or full control of the firms it buys into, and an initial rate of return (IRR) on its investments of around 15 percent, which will be distributed to shareholders through dividends.
Twenty-five percent of the IPO cash will be dedicated to social infrastructure, such as expanding real estate, with the remainder allocated to an innovation fund, said Belhoul, who is also founder and managing partner of Ithmar Capital.
Credit Suisse and Deutsche Bank are joint coordinators of the IPO, with Emirates Financial Services and National Bank of Abu Dhabi lead managers. Shuaa Capital is offer manager.-Reuters