Delivery Hero, the Germany-based food delivery platform, is preparing to list share of its UAE subsidiary Talabat on the Dubai bourse, as it looks to capitalise on the continued economic momentum and listing boom in the Emirates this year.
The Frankfurt-listed Delivery Hero is “preparing” for the initial public offering of Talabat on the Dubai Financial Market in the fourth quarter of this year, Talabat said in a statement on Thursday.
The Berlin-based parent will sell existing shares in its Emirati subsidiary, it said without giving the size of the potential public float or the use of its proceeds.
“A listing may be pursued through a secondary sale of shares by Delivery Hero which would retain the majority interest in the local listing entity after an IPO,” Delivery Hero said in a separate bourse filing on Thursday.
Talabat, the on-demand food and quick-commerce app, said its IPO remains subject to regulatory approvals and market conditions. The company and its parent will update the market regarding the progress on the potential listing.
Growing pipeline
Talabat joins a growing list of companies seeking to list share on equity markets in the UAE this year amid continued economic momentum in the Arab world’s second-largest economy.
Talabat’s intention to float follows construction and dredging services provider NMDC Group’s announcement on Wednesday to list shares of its unit NMDC Energy on the Abu Dhabi Securities Exchange.
The company has secured listing approval from the market regulator Commodities and Securities Authority for what would be the UAE’s biggest IPO this year.
NMDC Group plans to raise Dh3.22 billion ($877 million) from the sale of its stake in its energy subsidiary. The parent is offering 1.15 billion shares in the business at Dh2.80 dirhams a piece, it said in a statement.
The subscription period for the deal will start on Friday and will remain open until September 4 for individual and qualified investors.
First Abu Dhabi Bank is the lead manager for the deal, which would trump the $515 million raised by Alef Education earlier this year, but will be smaller than the healthcare operator Pure Health’s $986 million listing in December last year.
The list of potential IPOs is also growing.
In June, UAE-based hospital operator NMC Healthcare appointed Rothschild as a financial adviser to help it explore strategic options for its shareholders, including an IPO.
Abu Dhabi’s LuLu Group International is also planning to launch its IPO this year and list its shares on the ADX, the region's second-largest bourse by market capitalisation.
The hypermarket and chain operator has hired investment bank Moelis to advise it on the deal, a company representative told The National last year.
IPO momentum
The UAE, as well as the other members of the six-member economic bloc of the GCC, have seen a consistent rise in IPO activity over the past two years.
Companies in the UAE raised $890 million through IPOs in the second quarter of this year alone.
Saudi Arabia's Tadawul, however, led the volume of deals, with companies in the kingdom raising an aggregate of $1.6 billion, or 61 per cent, of the total IPO activity recorded during the period, according to PwC's quarterly IPO Watch report.
The DFM, over the past few years, has also seen substantial listing activity.
Companies in Dubai raised Dh34.5 billion through selling shares in the past three years, with aggregate investor demand for those listings reaching more than Dh1 trillion, the Dubai Securities and Exchange Higher Committee said in March.
The continued IPO activity in that period has helped the Dubai bourse to maintain robust growth that pushed its general index to become the fifth-best performer globally last year, the committee said.
In November 2021, Dubai said it would list 10 state-owned companies and establish a Dh2 billion market maker fund to encourage listings from private companies in sectors such as energy, logistics and retail.
The government aims to expand the size of the emirate's financial market to Dh3 trillion and six state-owned enterprises have listed on the DFM since 2022.
Retailer Spinney's was the last to list shares on the DFM in April. Parking operator Parkin's IPO in March was the first in the UAE capital markets this year, which raised Dh1.57 billion from investors. Demand for the deal hit a record Dh259 billion.
UAE currency: the story behind the money in your pockets
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Mohammed bin Zayed Majlis
Dhadak 2
Director: Shazia Iqbal
Starring: Siddhant Chaturvedi, Triptii Dimri
Rating: 1/5
READ MORE ABOUT CORONAVIRUS
MATCH INFO
Uefa Champions League semi-final, first leg
Bayern Munich v Real Madrid
When: April 25, 10.45pm kick-off (UAE)
Where: Allianz Arena, Munich
Live: BeIN Sports HD
Second leg: May 1, Santiago Bernabeu, Madrid
CREW
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Islamophobia definition
A widely accepted definition was made by the All Party Parliamentary Group on British Muslims in 2019: “Islamophobia is rooted in racism and is a type of racism that targets expressions of Muslimness or perceived Muslimness.” It further defines it as “inciting hatred or violence against Muslims”.
Favourite things
Luxury: Enjoys window shopping for high-end bags and jewellery
Discount: She works in luxury retail, but is careful about spending, waits for sales, festivals and only buys on discount
University: The only person in her family to go to college, Jiang secured a bachelor’s degree in business management in China
Masters: Studying part-time for a master’s degree in international business marketing in Dubai
Vacation: Heads back home to see family in China
Community work: Member of the Chinese Business Women’s Association of the UAE to encourage other women entrepreneurs
Seemar’s top six for the Dubai World Cup Carnival:
1. Reynaldothewizard
2. North America
3. Raven’s Corner
4. Hawkesbury
5. New Maharajah
6. Secret Ambition
The%20specs
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Blonde
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The Light of the Moon
Director: Jessica M Thompson
Starring: Stephanie Beatriz, Michael Stahl-David
Three stars
The Africa Institute 101
Housed on the same site as the original Africa Hall, which first hosted an Arab-African Symposium in 1976, the newly renovated building will be home to a think tank and postgraduate studies hub (it will offer master’s and PhD programmes). The centre will focus on both the historical and contemporary links between Africa and the Gulf, and will serve as a meeting place for conferences, symposia, lectures, film screenings, plays, musical performances and more. In fact, today it is hosting a symposium – 5-plus-1: Rethinking Abstraction that will look at the six decades of Frank Bowling’s career, as well as those of his contemporaries that invested social, cultural and personal meaning into abstraction.
Unresolved crisis
Russia and Ukraine have been locked in a bitter conflict since 2014, when Ukraine’s Kremlin-friendly president was ousted, Moscow annexed Crimea and then backed a separatist insurgency in the east.
Fighting between the Russia-backed rebels and Ukrainian forces has killed more than 14,000 people. In 2015, France and Germany helped broker a peace deal, known as the Minsk agreements, that ended large-scale hostilities but failed to bring a political settlement of the conflict.
The Kremlin has repeatedly accused Kiev of sabotaging the deal, and Ukrainian officials in recent weeks said that implementing it in full would hurt Ukraine.
UAE%20PREMIERSHIP
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Teri%20Baaton%20Mein%20Aisa%20Uljha%20Jiya
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The Gentlemen
Director: Guy Ritchie
Stars: Colin Farrell, Hugh Grant
Three out of five stars
Email sent to Uber team from chief executive Dara Khosrowshahi
From: Dara
To: Team@
Date: March 25, 2019 at 11:45pm PT
Subj: Accelerating in the Middle East
Five years ago, Uber launched in the Middle East. It was the start of an incredible journey, with millions of riders and drivers finding new ways to move and work in a dynamic region that’s become so important to Uber. Now Pakistan is one of our fastest-growing markets in the world, women are driving with Uber across Saudi Arabia, and we chose Cairo to launch our first Uber Bus product late last year.
Today we are taking the next step in this journey—well, it’s more like a leap, and a big one: in a few minutes, we’ll announce that we’ve agreed to acquire Careem. Importantly, we intend to operate Careem independently, under the leadership of co-founder and current CEO Mudassir Sheikha. I’ve gotten to know both co-founders, Mudassir and Magnus Olsson, and what they have built is truly extraordinary. They are first-class entrepreneurs who share our platform vision and, like us, have launched a wide range of products—from digital payments to food delivery—to serve consumers.
I expect many of you will ask how we arrived at this structure, meaning allowing Careem to maintain an independent brand and operate separately. After careful consideration, we decided that this framework has the advantage of letting us build new products and try new ideas across not one, but two, strong brands, with strong operators within each. Over time, by integrating parts of our networks, we can operate more efficiently, achieve even lower wait times, expand new products like high-capacity vehicles and payments, and quicken the already remarkable pace of innovation in the region.
This acquisition is subject to regulatory approval in various countries, which we don’t expect before Q1 2020. Until then, nothing changes. And since both companies will continue to largely operate separately after the acquisition, very little will change in either teams’ day-to-day operations post-close. Today’s news is a testament to the incredible business our team has worked so hard to build.
It’s a great day for the Middle East, for the region’s thriving tech sector, for Careem, and for Uber.
Uber on,
Dara
