ADNH Catering, a subsidiary of ADNH Hotels, is planning to go public in the UAE this month to raise funds for expansion. The IPO will offer 900 million shares worth 40% of the company’s total issued share capital. The company, which provides food preparation and support services, will determine the offer price after the book-building process. The subscription period for retail investors and eligible employees will open on October 7 and end on October 14, while professional investors have until October 15 to subscribe.
Existing shareholders of ADNH Group will have priority access to up to 10% of the offer shares during two tranches, based on their percentage holdings as of October 2. The shares will be listed on the Abu Dhabi Securities Exchange in October, with a lock-up period of 180 days for selling shareholders. Investors can subscribe through First Abu Dhabi Bank and other appointed receiving banks. The offering has been confirmed as Shariah-compliant by the Internal Shariah Supervision Committee of First Abu Dhabi Bank.
Following the IPO, the company plans to pay a cash dividend of Dh60 million in April 2025 for the financial year ending December 31, 2024. For the financial year ending December 31, 2025, a total cash dividend of Dh180 million will be split equally between two payments. In the financial year ending December 31, 2026, the company intends to increase the dividend by a minimum of 5%, with payments split equally between two periods. Starting from January 1, 2027, the company will adopt a progressive dividend policy linked to its financial performance, paying dividends on a semi-annual basis.
Over the past few years, many companies in the UAE have chosen the IPO route to raise funds for expansion. The IPOs of companies like Alef Education have seen strong interest from institutional and retail investors, resulting in oversubscription. ADNH Catering aims to follow suit by offering a substantial portion of its share capital through the IPO. With operations extending to Saudi Arabia, the company provides a range of services including food preparation, cleaning, housekeeping, pest control, and procurement.
Investors looking to subscribe to the ADNH Catering IPO should be aware of the important details, such as the number of shares available, the stake being floated, the offer price determination process, and the subscription period. Existing shareholders will have the opportunity to apply for up to 10% of the offer shares in priority to other applicants. The company plans to pay dividends based on its financial performance, with a progressive policy starting from 2027.
Overall, ADNH Catering’s IPO presents an investment opportunity for those interested in the hospitality and catering sector in the UAE and Saudi Arabia. With a clear plan for expansion and a commitment to pay dividends to shareholders, the company aims to attract both institutional and retail investors. As the IPO date approaches, potential investors should conduct their due diligence and consider factors like the company’s financial performance, growth prospects, and industry trends before making investment decisions.
