UAE exchange Al Ansari drew $3.45B in bid for $210M IPO

UAE-based foreign exchange and payments transfer company Al Ansari Financial Services drew Dh12.7 billion ($3.45 billion) bid on Friday for its $210 million IPO.

The first half of the dividend payment will be made in October 2023, and the second half in April 2024. The trading will start on the Dubai Financial Market on April 6.

In a report by the National News, Dh773 million was raised from the sale of a 10% stake in the IPO. The global offering was oversubscribed by 22 times, according to the report. The retail offer increased from 5% to 7.5% of the total offering size and was oversubscribed by close to 44 times.

The report added, the company sold over 750 million shares and set the final share price at Dh1.03. This was at the higher end of the offer range between Dh1 and Dh1.03 a share. This implies a market capitalisation of Dh7.73 billion ($2.1 billion) at listing.

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The investment arm of the Dubai government, National Bonds Corporation owned by the Investment Corporation of Dubai has committed to an investment of Dh200 million in the IPO.

Rashed Al Ansari, Group CEO of Al Ansari Financial Services, said that through the IPO, the team is offering investors an opportunity to be part of a business that has significant growth opportunities pushed forward by the GCC and the UAE's favourable macroeconomic trends.

Al Ansari added, as a publicly listed company, the company intends to further build its credibility, increase transparency with existing stakeholders, and also attract new partners and enter new markets with ease.

The Emirates Investment Authority is entitled to subscribe up to 5% of the offering, and the percentage of shares that it may purchase will be allocated before they are allotted to any other qualified investors.

Al Ansari expects to distribute a minimum dividend of Dh600 million for the 2023 financial year, implying a minimum dividend yield of 7.77% to 8%.

In 2022, IPOs in the Middle East raised over $23 billion as compared to the $7.52 billion the region had raised in 2021 across 20 offerings. Set up 60 years ago, Al Ansari exchange has over 231 branches in the UAE. It offers exchange services, a system to pay domestic workers, remittances, and a savings plan.