International Holding Company, the largest listed company in the UAE, is divesting its entire stake in Modon Holding as the Abu Dhabi conglomerate seeks to avoid "over-concentration" of its portfolio in any single sector.
The company will be selling its 42.54 per cent stake in Modon, a wholly owned real estate and infrastructure development company of the Abu Dhabi government, to L’imad Holding, IHC said in a statement on Thursday to Abu Dhabi Securities Exchange, where its shares are traded.
“The transaction is a deliberate, strategic step within IHC’s active portfolio management programme to maintain balanced exposure across sectors and geographies and unlock additional liquidity,” the company said.
“The sale aligns with IHC’s sector concentration framework, which targets no more than 20 per cent exposure to any single sector.”
The company did not disclose the total value of the deal but said it plans to invest in high growth sectors including health care, technology, energy, food and agriculture and financial services.
“This sale reflects our disciplined approach to capital allocation and our commitment to maintaining a well-balanced, diversified portfolio,” Syed Basar Shueb, chief executive of IHC, said.
“While we continue to see attractive fundamentals in real estate, our strategy is to avoid over-concentration in any single sector.”
Set up 1999, IHC, the private sector bellwether and a major part of Abu Dhabi's efforts to diversity its non-oil business sectors, has more than 1,300 subsidiaries, with investments in sectors including asset management, healthcare, real estate, financial services and IT, among others.
This month, IHC also announced the merger of three of its portfolio companies, 2PointZero, Multiply Group, and Ghitha Holding, to create a Dh120 billion ($33 billion) energy and consumer sector-focused investment platform.
The merged entity will be renamed the 2PointZero Group and will continue to be listed on the ADX, uniting three platforms across sectors that are essential to future global growth, it said at the time.
Overall, IHC has been on an investment and acquisition spree as it aims to double its asset base to $218 billion by 2030.
The company in May announced the launch of RIQ, a $1 billion global reinsurance platform, which it developed in partnership with BlackRock, the world's largest asset manager.
This year, it also announced the acquisition of Maseera, a microfinance platform in Egypt, with a commitment to invest $1 billion over the next years to support its expansion.
IHC has also shown interest in expanding its portfolio assets in India and fast-growing economies in Central Asia, as well as the US.
Earlier this month, the Abu Dhabi conglomerate agreed to acquire a 43.5 per cent stake in India’s Sammaan Capital in a $1 billion deal.
It also acquired a majority stake in Pakistan's state-owned First Women Bank to boost its global portfolio this month.
