Page 94 - SALIK PR REPORT OCTOBER 2024
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Joint lead receiving banks are Abu Dhabi Commercial Bank and First Abu Dhabi. Joint lead
managers are Abu Dhabi Commercial Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC
Bank Middle East and EFG Hermes UAE. The receiving banks are First Abu Dhabi Bank, Dubai
Islamic Bank, Emirates Islamic Bank, Abu Dhabi Commercial Bank, Mashreq and Emirates NBD.
The UAE has seen a host of IPOs from public and private sector entities over the past couple of
years including Dubai Taxi Corporation, Salik, Al Ansari Exchange, Pure Health, Investcorp
Capital, Phoenix Group, Adnoc entities and many others.
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The previous IPOs witnessed exceptionally strong demand from retail and institutional investors.
Analysts are confident that Lulu’s share sale will also see an overwhelming response from the
investors next week.
Lulu Group is one of the largest retailers in the UAE and GCC region, employing over 50,000
workers. Investors have been waiting for the retail giant’s IPO to own a stake in the retail major.
ADQ had bought a 20 per cent stake in the company for $1 billion in 2020, which helped the retailer
to expand to new markets.
Under the first tranche, 258.222 million shares will be up for subscription, representing 10 per cent
of the offer share. Each subscriber – other than eligible employees – will have a minimum
guaranteed allocation of 1,000 shares and each eligible employee will have a minimum guaranteed
allocation of 2,000 shares.
Under the second tranche, Lulu Retail aims to offload 2,298,181,441 shares, representing 89 per
cent of the off share. Over 25.822 million shares will be sold through the third tranche, representing
one per cent of the offer share.
The selling shareholders reserve the right to amend the public subscription, according to the
prospectus.
The selling shareholders will have a lock-up period of 180 days after the listing on the Abu Dhabi
Securities Exchange.
Lulu Group is the largest full-line retailer with stores in all GCC countries by selling space, sales and
number of stores in 2023. The Group was the second-largest grocery retailer in UAE and largest in
Oman, Qatar, Bahrain, and Kuwait and the fastest-growing and largest pan-GCC retailer in Saudi
Arabia, according to market consultants. It currently has a strong omni-channel presence in the
form of 3 formats – hypermarkets, express stores and mini-markets.
By August 2024, the group operated 240 stores, comprising 116 hypermarkets, 102 express stores
and 22 mini markets with 103 stores located in the UAE, 56 in Saudi Arabia and 81 across other
markets.
The group’s total selling space as of December 31, 2023, was approximately 1.3 million square
metres, which was around 3 times higher than the average selling space of its listed peers in the
GCC. The retailer, on average, served over 600,000 daily shoppers every day in 2023. Sourcing
products from 85 countries, it operates a network of 21 distribution centres in the GCC to support
its retail operations.
Lulu joins other grocery firms that have listed, such as UAE-based Spinneys this year, and Saudi
grocery retailer BinDawood Holding in 2020.
Dividend policy
The company plans a total dividend pay-out ratio of 75 per cent of annual distributable profits after
tax, paid semi-annually. It plans to pay a dividend for the six months ending on December 31 in the
first half of 2025.
https://www.khaleejtimes.com/uae/uae-retailer-lulu-to-launch-ipo-next-week-sell-25-stake