Spinneys 1961 Holding PLC Announces Offer Price Range and Start of Subscription Period for Initial Public Offering

Spinneys 1961 Holding PLC, a supermarket chain franchisee in the United Arab Emirates and Oman, has announced the price range and subscription period for its initial public offering (IPO) on the Dubai Financial Market (DFM). The company is seeking to raise up to 1.37 billion dirhams ($375 million) by selling a 25% stake.

The offer price range has been set between 1.42 dirhams ($0.38) and 1.53 dirhams per share, implying a market capitalization upon listing of between 5.11 billion dirhams ($1.39 billion) and 5.51 billion dirhams ($1.50 billion). The final offer price will be determined through a book-building process and is expected to be announced on May 1, 2024.

The IPO subscription period starts on April 23, 2024 and runs until April 29, 2024 for UAE retail investors and April 30, 2024 for professional investors. The company will offer 900 million shares, equivalent to 25% of its issued share capital.

Emirates International Investment Company LLC (EIIC) and Templeton Asset Management and Franklin Templeton Investments will be cornerstone investors in the IPO with a total commitment of 275 million dirhams ($75 million).

Why this matters: Spinneys' IPO marks a rare private sector listing in the UAE market and is expected to attract strong interest from investors. The company's expansion plans into Saudi Arabia also position it to capitalize on the Kingdom's development and increasing demand for retail products.

Spinneys currently owns and operates 70 stores in the UAE, including 15 Waitrose stores, and five Spinneys and Al Fair stores in Oman. The company plans to expand its store network in the UAE, with three new stores expected to open this year, and make its debut in the Saudi market, focusing on Riyadh and Jeddah.

"We are very excited about the strong interest shown by investors in our business," said Sunil Kumar, CEO of Spinneys. The company is expected to start trading on the DFM on May 9, subject to market conditions and regulatory approvals. Spinneys plans to maintain a dividend payout ratio of 70% of annual distributable profits after tax for fiscal 2024 and the following years.

Key Takeaways

• Spinneys 1961 Holding PLC to raise $375M via 25% IPO on Dubai Financial Market.
• IPO price range set at 1.42-1.53 AED per share, valuing company at $1.39-1.50B.
• IPO subscription period from April 23-30, 2024; cornerstone investors committed $75M.
• Spinneys plans to expand in UAE and enter Saudi Arabia, focusing on Riyadh and Jeddah.
• Spinneys targets 70% dividend payout ratio for fiscal 2024 and following years.