Tecom IPO: Dubai company raises $463m from oversubscribed DFM listing

Tecom IPO: Dubai company raises $463m from oversubscribed DFM listing
The UAE Strategic Investment Fund and Shamal Holding are cornerstone investors in the IPO, with a total commitment of Dh283.75m.

June 27, 2022

Dubai’s Tecom Group, the operator of business districts that are home to more than 7,800 companies, raised Dh1.7 billion ($463 million) from its initial public offering on the Dubai Financial Market.

The IPO was 21 times oversubscribed, with total gross demand at more than Dh35bn. The company had set its offering price range between Dh2.46 and Dh2.67 a share, with the final share price set at Dh2.67, giving it a valuation of Dh13.4bn.

Dubai Holding sold 625 million shares, or 12.5 per cent in Tecom, as part of a series of IPOs of state enterprises aimed at boosting the size of the emirate’s capital market.

While the offering reflected an average oversubscription of 21 times for both qualified and retail investors, the UAE retail offer was 40 times oversubscribed, making it the highest oversubscription multiple for listings on the Dubai Financial Market.

As a result of the extremely strong demand, the final offer price was set at the top of the price range.

“The tremendous demand we drew both locally and internationally … especially amid challenging market conditions, is testament to the company’s appealing value proposition and growth prospects,” said Malek Al Malek, chairman of the Tecom Group.

“Investors’ strong appetite is underpinned by their optimism toward Dubai’s economy and confidence in the emirate’s capital markets.

“We are incredibly proud to have received the highest ever oversubscription multiple in the retail tranches for any IPO on the DFM, demonstrating the trust that this important investor base has in Tecom Group.”

The UAE Strategic Investment Fund and Shamal Holding are cornerstone investors in the IPO, with a total commitment of Dh283.75m.

Tecom comprises 10 business districts that include Dubai Internet City, Dubai Media City and Dubai Design District.