Lulu Retail sets IPO price range to raise up to $1.4 billion
Lulu Retail Holdings said on Monday that it plans to sell its shares for $0.53 to $0.56 (AED 1.94 to AED 2.04) each in its upcoming public offering. The company hopes to raise up to $1.43 billion (AED 5.27 billion) through this sale.
Lulu Retail IPO Details
- Subscription Period: Investors can apply for the IPO from October 28 to November 5.
- Offer Price: The final price of the shares will be decided through a process called book-building and announced on November 6.
- Shares Offered: The company is selling 25% of its shares (2.6 billion shares) on the Abu Dhabi Securities Exchange (ADX).
- Valuation: Lulu Retail’s value will be between $5.46 billion (AED 20.04 billion) and $5.74 billion (AED 21.07 billion) based on the offer price.
- Selling Shareholder: All the shares in the IPO are being sold by Lulu International Holdings Limited, the company’s sole owner.
- Dividend Policy: Lulu plans to pay 75% of its yearly profits after tax as dividends, twice a year. The first dividend for profits made in the second half of 2024 will be paid in the first half of 2025.
- Listing Date: The shares are expected to be listed on the Abu Dhabi exchange on November 14, depending on market conditions and approvals.
- Lock-in Period: The shareholder selling the shares will not sell any more shares for 180 days after the IPO.
- Investor Categories:
- Retail investors and employees are in the first group.
- Institutional investors are in the second group.
- Senior executives are in the third group.
- Financial Advisors:
- Moelis & Company UK LLP DIFC Branch is the independent advisor.
- Joint Global Coordinators and Bookrunners: Abu Dhabi Commercial Bank, Citigroup, Emirates NBD Capital, and HSBC.
- Joint Bookrunners: Alrajhi Capital, EFG-Hermes UAE, First Abu Dhabi Bank, Goldman Sachs, and International Securities.
Key Quote
“Our offer gives both local and international investors a chance to benefit from the growth of the largest retailer across the GCC and the fastest-growing brand in Saudi Arabia,” said Lulu Retail CEO Saifee Rupawala.
“We’re confident about meeting our goals for 2024 and beyond. The offer price range reflects our focus on ensuring strong stock performance after the listing, and we welcome all investors to be part of Lulu Retail’s exciting future.”
Big Numbers
Every day, more than 600,000 customers shop at Lulu’s different store formats.
Lulu has 240 stores, including hypermarkets, express outlets, and minimarkets, spread across the six GCC countries. It also plans to open more stores to improve efficiency.
Serving shoppers from 130 nationalities, Lulu sources products from 85 countries, with sourcing operations in 19 countries to meet demand.
Cornerstone Investors
On October 28, the company and the selling shareholder made agreements with key investors, including the Abu Dhabi Pension Fund, Bahrain Mumtalakat Holding Company, Emirates International Investment Company, and Oman Investment Authority. These investors agreed to buy shares in the offering at the set price, the company said.
The total investment from these cornerstone investors is about $205 million (AED 753 million). Their shares will be locked for 180 days after the company is listed, meaning they cannot sell them during this period.
Lulu Retail Overview
Founded in 1974, Lulu Retail and its subsidiaries are the largest retailer in the GCC region in terms of store space, sales, and the number of outlets.
Lulu Group International reported annual revenues of $8.4 billion, according to the company.
Founder’s Net Worth
M A Yusuff Ali, the founder of Lulu Group, has a net worth of $7.4 billion as of October 28, according to Forbes. He is ranked third on Forbes Middle East’s Richest Billionaires 2024 list.
Published: 28th October 2024
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