01/10/2025 05:34 AST
ALEC Holdings, a market-leading diversified engineering and construction group, today announced that it successfully completed the book building and subscription process for its IPO on September 30, raising AED1.4 billion ($381 million) in the offering.
The final offer price was set at AED1.40 per share, at the top end of the previously announced price range and the offering was oversubscribed 21 times, it said.
Details of the final offer price
A total of 1,000,000,000 (one billion) ordinary shares, equivalent to 20% of ALEC's share capital, were on offer by the Investment Corporation of Dubai (the Selling Shareholder or ICD), the principal investment arm of the Government of Dubai. Based on the final offer price, ALEC has successfully raised AED1.4 billion, implying a market capitalisation of AED7 billion ($1.91 billion) upon listing on the DFM.
Marking a historic milestone, this is the UAE's largest ever construction IPO in terms of both valuation and size and the first IPO in the sector in over 15 years. All of the offer shares are existing shares currently held by the Selling Shareholder, and ALEC will not receive any proceeds from the offering. Following the offering, ICD will hold a stake of 80% in the company.
Pursuant to the company's dividend policy, ALEC is expected to distribute a cash dividend of AED200 million in April 2026, and a cash dividend of AED500 million with respect to financial year 2026, with the first payment to be made in October 2026 and the second payment in April 2027. Based on the financial year 2026 dividend of AED500 million and final offer price of AED1.40 per share, the dividend yield will be 7.1% upon listing. Thereafter, the company expects to distribute cash dividends on a semi-annual basis (in April and October of each year), with a minimum payout ratio of 50% of the net profit generated for the relevant financial period, subject to the approval of the Board of Directors and the availability of distributable reserves, a statement said.
Details of the IPO subscription
The offering attracted considerable interest from a broad range of high-quality investors with a total gross demand of approximately AED0 billion ($8.1 billion), resulting in an oversubscription of more than 21 times across all three tranches. The IPO recorded one of the highest levels of non-UAE investor participation among recent UAE government-related listings on the DFM, it said.
Investors that participated in the Individual Subscribers Offering (First Tranche) and Eligible ALEC and ICD Employees Offering (Third Tranche) will be notified of their allocation of shares via SMS on October 7, with refunds due to commence from October 8.
Barry Lewis, Chief Executive Officer of ALEC Holdings, said: "We are proud that ALEC's IPO drew strong demand and significant interest from a diverse and high-quality investor base. This is a clear vote of confidence in ALEC's distinct value proposition and disciplined operating model. The strong response also signals broader investor conviction in the region's construction sector, underpinned by ambitious national agendas and a strong pipeline of transformational projects. We are deeply thankful to our new shareholders for placing their trust in ALEC, and we look forward to the journey ahead as we continue to scale, deliver, and grow value together."
The completion of the offering and admission are currently expected to take place on October 15 under the symbol "ALEC" and ISIN "AEE01710A255", subject to market conditions and obtaining relevant regulatory approvals in the UAE, including approval of admission to listing and trading on the DFM, the ALEC statement said.
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