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UAE’s Lulu Retail Holding (Lulu) has increased its IPO offer size to 30% from the 25% previously announced to cater to demand from global investors.
The total offer size has been increased to 3.09 billion shares. The additional 516,445,267 shares have been wholly allocated to the Qualified Investor Offering (Tranche Two), accessible to professional investors only.
Masarrah Investment Company has been added as a cornerstone investor with a commitment of 250 million UAE dirhams ($68 million).
The retail giant also has cornerstone investor agreements with the Abu Dhabi Pension Fund, Bahrain Mumtalakat Holding Company, Emirates International Investment Company LLC (EIIC) and Oman Investment Authority.
The offer is expected to be priced at AED 2.04 dirhams a share at the top end of a range that started at AED 1.94 dirhams, according to sources, implying a market capitalisation of AED 21.1 billion.
Last month, the retail giant announced it will sell 2.58 billion shares, representing 25% of its stake through a three-tranche IPO that will start on October 28 and close on November 5.
The company will list its shares on the Abu Dhabi Securities Exchange (ADX) on November 14.
The company is targeting a total dividend pay-out ratio of 75% of annual distributable profits after tax, paid semi-annually.
A source familiar with the deal told Zawya that the retail group, which owns hypermarkets supermarkets and malls across the GCC, Egypt, Far East, and India, was looking to raise between $1.7 billion and $1.8 billion through its IPO.
(Writing by Bindu Rai, editing by Seban Scaria)
