Dubai: Alef Education Opens Subscription for 1.4 Billion Shares
Alef Education has opened subscriptions for 1.4 billion shares, representing 20% of its issued share capital. This marks the UAE's third IPO of 2024, following Parkin and Spinneys, and the first on the Abu Dhabi Securities Exchange (ADX).
The share offer is priced between Dh1.30 and Dh1.35 each, suggesting a market capitalization of Dh9.10 billion to Dh9.45 billion upon listing.
Subscriptions are open until June 4 for retail investors and June 5 for institutional investors. Alef Education, a key solutions provider to all public schools in the UAE and many private institutions, is associated with over 7,000 schools, including international markets. The company has a strong track record with 7 years remaining on a 12-year minimum fee contract.
"Our growth and the trust we’ve built with international governments, customers, and partners, including ADEK (Abu Dhabi Department of Education and Knowledge), have led to this milestone," said Abdulhamid Mohammed Saeed Alahmadi, Chairman.
What is the dividend policy?
Alef Education will follow a semi-annual dividend policy with a minimum payout ratio of 90% of net profit for 2024 and 2025.
The company aims to distribute a minimum dividend of Dh135 million over these two years.
"If during the guaranteed minimum dividend period, the declared dividend falls below the target minimum amount, the selling shareholders may, without breaching AAOIFI Shariah standards, forgo their dividends to ensure the intended amount is paid to all other shareholders," stated the company.
DIVIDEND YIELD
The offer price range implies a dividend yield of 7.14 per cent to 7.42 per cent.
According to Geoffrey Alphonso, CEO, “Our investment proposition has been incredibly well received by the market, with significant interest in our offering since announcing our intention to float.
"With the opening of subscriptions, we are offering UAE and international investors the opportunity to participate in the growth of a leading and homegrown player in the education technology sector—an underrepresented sector across UAE capital markets.
We are committed to driving further growth across our platform and delivering sustainable long-term shareholder value, supported by our robust dividend policy."
Schools and edtech
Alef Education can be defined as an 'edtech' firm, with its solutions and services geared to aiding school going children. According to Forbes, the edtech industry globally is expected to rise from $133 billion in 2023 to $433 billion by 2030 growing at a cagr of 18.3 per cent. "Alef’s entry into this space allows investors to capitalize on this growth opportunity for not only the UAE but the region and internationally as its 'asset light' model differentiates it from traditional school operators," said Sameer Lakhani, Managing Director at Global Capital Partners.
Source: Gulf News
Image: The National
