ADNH Catering raises US$235M in IPO offering

UAE – Leading catering and support service provider ADNH Catering has raised AED 864 million (US$235 million) through its initial IPO, pricing its shares at the top of its indicated pricing range.

The catering unit of Abu Dhabi National Hotels (ADNH) set the final price at AED 0.96 (US$0.26) per share for its public offering on the Abu Dhabi Securities Exchange (ADX).

The company offered 900 million shares, 40% of its total share capital, which implies a market valuation of AED 2.16 billion (US$588 million).

According to an official statement by the catering unit, all shares offered for sale via the IPO were held by the parent company, ADNH which also trades on ADX.

The share sale was available for UAE retail investors and employees from October 7 to 14. The sale was available on October 15 for professional investors.

ADNH Catering reported the share sale was oversubscribed multiple times, which signaled what it described as ‘substantial demand from both international and regional investors.’

Shares are expected to start trading on ADX on October 23, albeit subject to regulatory approval.

Clive Cowley, ADNH Catering’s Chief Executive Officer, said, “The strong investor demand we have received for our IPO … reflects the confidence that investors have in ADNH Catering’s investment proposition, strategy and trajectory.”

“The strong investor demand we have received for our IPO … reflects the confidence that investors have in ADNH Catering’s investment proposition, strategy and trajectory.”

The CEO also described the competition and oversubscription of the IPO as a critical milestone for the catering company. Cowley reiterated the IPO was an indication the company is set to expand its operations in the UAE, Saudi Arabia, and other territories in the Middle East.

ADNH Catering operates in Saudi Arabia via a joint venture with Compass Group and Al Rushaid Petroleum Investment Company. The company controls 30% of the joint venture.

Cowley revealed the company has initiated talks with its Saudi partners to increase its equity in the joint venture following the IPO offering.

The catering company operates across the healthcare, business and industry, defense, correctional, and education sectors and has approximately 160 on-site kitchens that serve more than 260 clients through 350 contracts.

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