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Supermarket chain LuLu Group is planning to offer up to a 25% stake (or c.2.6 bn shares) in an IPO on the ADX for its retail business, Lulu Retail, according to an intention to float (pdf). The IPO could potentially raise some USD 1.7-1.8 bn (AED 6.24-6.61 bn), Zawya quoted sources it says are in the know as saying, while Bloomberg said the IPO could value the company at USD 5 bn “at least.”
Refresher: LuLu Group tapped advisors in March to work on the IPO, with reports saying it could be done through a dual listing on Tadawul and ADX, though the company later reportedly decided to scrap dual-listing plans. LuLu Group kicked off an investor roadshow yesterday to market the IPO.
The details: The eight-day subscription period for both retail and institutional investors is between 28 October and 5 November. Shares are expected to begin trading on 14 November, according to the statement. Institutional investors will get 89% of the allocated shares, while retail investors can subscribe to 10% of the shares, with the final 1% reserved for senior executives at the company, according to the company’s prospectus (pdf).
About Lulu Retail: LuLu Retail is the largest pan-GCC full-line retailer, operating over 240 hypermarket, express, and mini-market stores across the six GCC countries and serving over 600k shoppers.
A glimpse into LuLu’s earnings: LuLu Retail saw its net income rise 133% y-o-y to USD 143.9 mn in 1H 2024, while revenues increased 5.6% y-o-y during the period to USD 3.9 bn, according to financials it published ahead of the IPO.
Dividends: LuLu plans to pay dividends worth 75% of its annual net income after tax. Dividends will be paid semi-annually, with the distribution for 2H 2024 set to take place in 1H 2025.
Biggest IPO of the year? The potential value of the IPO places it north of Spinneys, which raised AED 1.38 bn on the DFM in May; NMDC Energy’s AED 3.22 bn IPO in September; edtech firm Alef Education’s AED 1.89 bn IPO ; and Abu Dhabi National Hotels ’ (ADNH) catering business, ADNH Catering, which raised AED 864 mn earlier this month.
ADVISORS- Abu Dhabi Commercial Bank, Citigroup, Emirates NBD Capital and HSBC Holdings are joint coordinators and bookrunners, while Alrajhi Capital, EFG Hermes UAE, First Abu Dhabi Bank, and Goldman Sachs have been tapped as bookrunners. ADCB, Citigroup, Emirates NBD Capital, HSBC Holdings, and EFG Hermes UAE are also joint lead managers, while FAB and ADCB are joint lead receiving banks, along with our friends at Mashreq, Dubai Islamic Bank, Emirates Islamic Bank, and Emirates NBD, who are acting as receiving banks. Moelis & Co. is also acting as an independent financial advisor.
There’s more in the ADX pipeline:
- ADNH Catering’s shares are set to start trading on the ADX tomorrow;
- Alpha Data could tap the bourse this year;
- Etihad Airways has tapped advisors for what could be the Gulf’s first airline IPO next year.
