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Abu Dhabi National Hotels announced Monday that it will proceed with an initial public offering (IPO) for its catering business, ADNH Catering.
The company revealed its plans to offer 900 million Shares, representing 40 per cent of its share capital, through an IPO on the Abu Dhabi Securities Exchange (ADX). However, the offer price was undisclosed, which will be announced when subscriptions open on October 7 and end on October 14 for UAE retail investors and eligible employees and on October 15 for professional investors.
All Shares to be offered are existing shares held by Abu Dhabi National Hotels Company PJSC, a comprehensive semi-government hospitality group in Abu Dhabi, as the selling shareholder. Up to 10 per cent of the offer shares will be made available for allocation to existing shareholders of ADNH Group.
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Abu Dhabi National Hotels was founded in 1976 and owns hotels such as the Ritz Carlton and Park Hyatt in Abu Dhabi, among others. Its shareholders include sovereign wealth fund Mubadala and UAE-based investment firm National Holding.
Commenting on the offering, Khalaf Sultan Al Dhaheri, Chairman of ADNH Catering, said: "I am delighted to announce our intention to float a 40% equity stake in ADNH Catering on the Abu Dhabi Securities Exchange. Since 1979, ADNH Catering has been a core component of the growth of the UAE’s hospitality industry, partnering with government and private sector clients across food services and support services. Its proven track record, specialised expertise and focus on innovation and development has enabled it to be a long-term partner of choice for leading institutions and companies in the UAE and Saudi Arabia.
"The announcement today has been made possible by the people and culture at ADNH Catering, where employees are the heart of the business, and by the support of our ambitious shareholder, Abu Dhabi National Hotels Company PJSC. Given the size of the market opportunity, which benefits from strong macroeconomic tailwinds and a clear growth strategy to create a leading GCC platform, ADNH Catering offers investors a truly compelling opportunity.”
The catering unit operates in Saudi Arabia and the UAE and provides food and support services. Last year, the unit posted revenues of 1.8 billion dirhams ($490.12 million) and an operating profit margin of around 11 per cent.
In recent years, the UAE has seen a flurry of IPOs as the government tries to deepen capital markets and attract investment.
According to LSEG data, 23 IPOs in the first half of this year raised $3.6 billion for companies in the Middle East and North Africa.
New listings included Saudi healthcare provider Fakeeh Care Group (4017.SE), opened new tab, which raised $763.5 million, and UAE supermarket franchisee Spinneys. Hypermarket and mall operator Lulu is also expected to go public later this year.
Delivery Hero is also preparing an IPO of its Emirati subsidiary Talabat on the Dubai stock exchange in the fourth quarter of this year.
Etihad Airways has been working hard to be ready for an IPO, but the decision to go public remains on shareholder ADQ, CEO Antonoaldo Neves said last week.
According to reports, the Abu Dhabi-based airline plans to make its stock market debut no sooner than 2025. This could potentially be the first IPO of a major Gulf airline as the UAE's capital ramps up its efforts to become a global travel hub.
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