Around AED 20.04 billion to AED 21.07 billion is the estimated market capitalisation of the company, which has set the offer price range between AED 1.94 and AED 2.04 per share.

For UAE retail investors, qualified senior executives, and professional investors, the subscription period has begun and is anticipated to end on November 5, 2024. The following day (November 6, 2024), the final offer price will likely be revealed after a book-building process.

In addition, Lulu announced on October 28th that it had signed cornerstone investor agreements with the state-backed Abu Dhabi Pension Fund, the Oman Investment Authority, Bahrain’s sovereign wealth fund Mumtalakat, and Abu Dhabi’s Emirates International Investment Company (EIIC) under the qualified investor offering at the offer price.

About AED 753 million has been committed by all of the Cornerstone Investors combined, with EIIC pledging to subscribe USD 100 million. The shares will be subject to a 180-day lock-up period after listing.

In a three-tier initial public offering (IPO), Lulu said that it would list 2.58 billion shares, or 25% of the company’s total share capital. A total dividend payout ratio of 75% of yearly distributable profits after taxes is the company’s goal, and it will be paid out semi-annually following its dividend policy.

In the first half of 2025, a dividend will be paid for the six months that concluded on December 31, 2024. The expected date of listing the shares on the ADX is 14 November. Emirates NBD Capital, HSBC Holdings, Abu Dhabi Commercial Bank and Citigroup are joint bookrunners, with Moelis & Co. retained as Financial Advisors.

Joint lead managers include First Abu Dhabi Bank, HSBC Bank Middle East, Emirates NBD Capital, Abu Dhabi Commercial Bank, and EFG Hermes. The joint lead receiving banks are FAB and ADCB, with the latter continuing to serve as a listing advisor.

Lulu, as of October 2024, has an extensive supermarket chain network in over 23 countries, including the Middle East, Asia, and Europe. The group operates over 260 stores in Middle Eastern countries, employs over 65,000 people, and achieves annual revenue exceeding USD 8 billion.

Meanwhile, Vietnam Prime Minister Pham Minh Chinh met with MA Yusuff Ali, chairman of Lulu Group, during an official visit to the UAE on October 27. During the meeting, Yusuff Ali expressed interest in expanding into the Vietnamese market, seeking support from the government and relevant ministries, while describing the Southeast Asian country as, “A wonderful country with impressive economic achievements.”

Yusuff Ali also praised the high quality of Vietnamese exports, stating that Lulu has established a representative office in Ho Chi Minh City to source Vietnamese goods for its supermarket system. The group also plans to collaborate with the Vietnamese Embassy to organise a day to promote Vietnamese agricultural products in the UAE and the wider Middle East market.

PM Chinh, during the meeting, urged Lulu Group to further promote Vietnamese products with potential that align with consumer preferences across the chain’s global supermarket system. He also suggested Lulu Group facilitate Vietnamese businesses’ participation in the Halal industry supply chain and consider investing and cooperating with potential Vietnamese partners in agricultural processing and establishing a supermarket chain in Vietnam, highlighting the country’s population of over 100 million with strong purchasing power.

PM Chinh proposed that the group coordinate with agencies to organise quarterly Vietnamese agricultural and goods promotion events in the Middle East.

The post UAE retail giant Lulu sets IPO price range amid Vietnam expansion prospects appeared first on International Finance.

According to the Dubai Chamber of Commerce, which used data from Euromonitor International, consumer food service businesses in the UAE made AED 58.4 billion (USD 15.9 billion) in sales in 2022. This was due to the quick response to and recovery from COVID and strong economic growth.

According to Mohammed Ali Rashed Lootah, president and chief executive officer of the Dubai Chamber, the amount is expected to increase by 48% to AED 86.4 billion (USD 23.5 billion) by 2027.

The food service industry, which includes cafes, bars, full-service and limited-service restaurants, as well as self-service cafeterias, is constantly monitored by Euromonitor. Full-service restaurant sales increased by 24% in 2022 to AED 32.5 billion, as per the company’s data.

As it introduced six business groups for the food and beverage (F&B) industry, including those for HORECA merchants, meat and poultry, bakeries, organic food, and grocery, as well as the hypermarket and supermarket sectors, the Dubai Chamber released the latest statistics.

By 2023, the chamber hopes to have 100 business groups established. It also stated that the groups would concentrate on fostering the growth of food businesses to raise Dubai’s food and beverage sector’s visibility in the international community.

Spending on fresh food is also anticipated to rise in the coming days. Between 2022 and 2027, sales are predicted to climb at a CAGR of 4.9%. In addition, a 3.9% increase will be seen in packaged food within the same time frame.

Traditional grocery store sales are anticipated to total AED 11.4 billion between 2021 and 2026, a CAGR of 3%.

During the same period, supermarket retail sales in the UAE are anticipated to increase to AED 19.7 billion, representing a 4% CAGR.

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Investec acquired Spinneys from a private equity firm Abraaj which is based in Dubai. Spinneys is a supermarket chain operating in Lebanon, Egypt and Qatar. The value of the deal was not disclosed. The deal is also Investec’s first private-equity investment in Egypt.

The asset management firm said that it has established a strong presence in Egypt with a current footprint of 13 outlets which comprises two hypermarkets and 11 supermarkets, including its two new openings in the last eight months. 

With regard to the investment, Spinneys Egypt CEO Mohanad Adly said “We have invested significantly to create what we believe to be a very strong value-driven offering, and have a strong pipeline of new stores planned.” 

Spinneys has established a strong customer value proposition with competitive pricing. The supermarket giant’s expansion has been carried out by the current management team, led by Adly with a successful portfolio in Egypt’s retail market. 

“I am delighted to be partnering with IAM for this new phase of development of the business and believe their international experience and financial support will enable us to accelerate our growth and roll-out of new stores, which will help to serve our Egyptian consumers,” he said. 

Last year,  Ezdehar and a few other private equity firms had proposed to acquire Spinneys from Abraaj, media reports said.

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