Dubai’s Spinneys Raises Retail Investor Tranche to 7% in IPO

A significant development unfolds within Dubai’s financial sector as Spinneys, a prominent player in the region’s retail landscape, amplifies its retail investor offering in its ongoing Initial Public Offering (IPO) process. This strategic move sees the allocation for retail investors soar from 5% to 7%, resulting in a substantial increase in available shares, jumping from the initial 45 million to 63 million shares.

Market and banking industry sources had widely anticipated this notable uptick, which comes on the heels of the closure of the retail investor tranche subscription on April 29th. Currently, institutional investors are in the subscription phase, with Spinneys poised to unveil the final offer price tomorrow.

In terms of pricing, the IPO’s stock price range has been established between Dh1.42 and Dh1.53 per share, signaling a potential market capitalization ranging from Dh5.11 billion to Dh5.51 billion. Despite the augmentation in the retail investor offering, the total size of the offer remains consistent at 900 million shares, comprising 25% of the company’s total issued share capital. The Dubai Financial Market (DFM) listing is set for May 9th.

As a consequence of the augmented retail segment allocation, the allocation for institutional investors has been adjusted downward to 837 million shares from the initial 855 million shares.

This strategic maneuver mirrors a broader trend observed in recent UAE IPOs, with higher retail investor portions witnessed in offerings from Parkin and Dubai Taxi Co., both of which experienced heavy oversubscription.

Sameer Lakhani, Managing Director at Global Capital Partners, underscores the significance of Spinneys’ decision, stating, “The increase by Spinneys continues to demonstrate the robust demand from retail investors, which is compelling in itself from a macro perspective. For Spinneys, it’s yet another validation of the soundness of their business model and the IPO pricing. It augurs well for the stock’s performance in the secondary market – as well as other private sector businesses wanting to go public.”

As Spinneys advances toward the culmination of its IPO journey, market attention now pivots to the next potential IPO in the UAE landscape. The spotlight is particularly on the LuLu Group, with speculation rife about a potential IPO in June. However, LuLu, the renowned hypermarket operator, has not confirmed any specific timelines, leaving industry observers eagerly anticipating further developments in the dynamic UAE IPO realm.