UAE: Lulu IPO oversubscribed 25 times; shares priced at Dh2.04

The offering raised gross proceeds of Dh6.32 billion, making it the largest UAE IPO of 2024 to date

Waheed Abbas

Published: Wed 6 Nov 2024, 11:03 AM

Last updated: Wed 6 Nov 2024, 11:22 AM

Lulu Retail on Wednesday announced final offer price of Dh2.04 per share, pricing at the top of the previously announced offer price range, implying a market capitalisation of Dh21.07 billion.

The IPO achieved aggregate demand of over Dh135 billion from local, regional, and international investors, a record for a non-government UAE IPO over the past 10 years, with the IPO oversubscribed by more than 25 times across all tranches.

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The offering raised gross proceeds of Dh6.32 billion, making it the largest UAE IPO of 2024 to date.

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On Monday, Lulu Retail increased the size of its initial public offering (IPO) by 5 per cent to 30 per cent, allocating more shares for professional investors.

The total offering size was increased to over 3.09 billion shares (3,098,671,605) from the previously announced over 2.58 billion shares (2,582,226,338).

The additional 516,445,267 shares have been wholly allocated to the qualified investor offering – tranche two, accessible to professional investors only.

Lulu Retail is expected to list shares for trading on the Abu Dhabi Securities Exchange on November 14.

The aggregate commitments of all the cornerstone investors crossed Dh1 billion ($273 million), of which Emirates International Investment Company (EIIC), committed to subscribe to $100 million. The cornerstone investors’ shares are subject to a 180-day lock-up arrangement.

Lulu Retail IPO received exceptional retail investor interest, with more than 82,000 retail investors subscribing to the offering – a record for a UAE IPO over the past 10 years.

“We’re extremely proud to see such strong demand for the Lulu Retail IPO, which raised over $1.72 billion and saw total aggregate demand of around $37 billion, a sign that investors share our passion and excitement for the company. We look forward to rewarding the trust shown by investors in Lulu and remain confident we will achieve our guidance targets in 2024 and beyond,” said Saifee Rupawala, CEO of Lulu Retail.

“We’re also incredibly pleased to see extremely strong and record demand from UAE retail investors, with more than 82,000 subscribing for shares,” said Rupawala.

The previous IPOs that were floated on the Dubai and Abu Dhabi bourses also saw tremendous response from retail and institutional investors, prompting some of them to increase the amount of funds that they were looking to raise through the share sale.

Among those who oversubscribed were utility services provider Dewa, which oversubscribed 37 times, Salik 49 times, Parkin 165 times and Borouge 45 times.

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