Al Ansari IPO: UAE money exchange increases number of shares on offer for retail investors

Retail portion of the offering increases to 7.5% of the total shares being sold

An Al Ansari Exchange branch in Deira, Dubai. Parent company Al Ansari Holding is selling a 10 per cent stake in Al Ansari Exchange. The National

Al Ansari Financial Services, the UAE foreign exchange and money transfer company, has increased the number of shares allocated to retail investors in its initial public offering due to “strong demand”.

The retail portion of the IPO has been raised to more than 56.25 million shares, from 37.5 million shares, equal to 7.5 per cent of the total shares on offer and up from the previously announced 5 per cent, the company said on Friday.

The qualified investor offer has been reduced to 693.75 million shares, from 712.5 million shares, equal to 92.5 per cent of the total shares on offer and lower than the previously announced 95 per cent.

Al Ansari Holding is selling 750 million shares, a stake of 10 per cent in Al Ansari Exchange, at an offer share price range of Dh1 to Dh1.03, implying a market capitalisation that is between Dh7.5 billion ($2.04 billion) and Dh7.73 billion ($2.10 billion) at listing.

The subscription periods for the UAE retail and qualified investors remain the same. The retail offering closed on Thursday while the qualified investor portion ends on Friday.

The final offer price will be determined through a book-building process and is expected to be announced on or around Monday, March 27, the company said.

Al Ansari may raise as much as $210 million from the IPO. The parent company will continue to own 90 per cent after the offering.

Al Ansari Exchange was set up about 60 years ago and has 231 branches throughout the UAE, offering exchange services, remittances, systems for paying domestic workers and savings plans.

The company opened its first exchange branch in the UAE in 1966 and also operates in Kuwait.

Al Ansari's IPO is part of a strategy to reposition the company for its next phase of growth, with proceeds going to parent entity Al Ansari Holding.

The UAE is the second-largest outward personal remittances market globally, with a total value of $48 billion, Al Ansari said earlier this month, citing a report by Edgar, Dunn and Company.

Al Ansari registered 22 million personal remittance transactions last year, with the money remitted increasing by 4.8 per cent to Dh737 million in 2022, compared with the previous year.

The company expects digital transactions to account for about a fifth of overall personal outward remittance transactions by 2027, up from 15 per cent in 2022.

Al Ansari believes exchange houses will continue to play a significant role, given the large and growing low-income resident population that is unbanked.

The company's net profit grew by 21 per cent to Dh595 million in 2022, compared with the previous year, and was up 59 per cent on its 2020 results.

Abu Dhabi Commercial Bank, EFG-Hermes and Emirates NBD are managing Al Ansari's IPO.