Delivery Hero shares were up 2% in Germany
Delivery Hero Boosts Size of Talabat’s Listing to $2 Billion
Delivery Hero SE boosted the size of its Middle Eastern unit’s initial public offering to as much as $2 billion, setting the deal up to be the United Arab Emirates’ biggest listing of the year.
The German firm now plans to sell a 20% stake in Talabat, up from 15%, it said in a statement on Wednesday. The deal is set to price at the 1.60 dirhams ($0.44) per share, the top end of a range that started at 1.50 dirhams, according to terms seen by Bloomberg News.
That would imply a market capitalization for Talabat of about $10.2 billion. Emirates NBD, one of the banks on the IPO, previously said that Talabat could be valued at up to $14.4 billion, while Bloomberg Intelligence estimated an enterprise value of as much as $12 billion.
Delivery Hero shares were up 2% in Germany, valuing the firm at about $11.9 billion. The company “may be building a war chest to pull the M&A trigger in other geographies of its portfolio, such as Asia and LatAm,” said Clément Genelot, an analyst at Bryan, Garnier & Co.
Talabat had demand for all shares minutes after subscriptions opened earlier this month, in another sign of robust demand for regional deals. It’s the latest in a slew of initial share sales in the Middle East, which have raised close to $11 billion so far this year.
Hypermarket chain Lulu Retail raised $1.7 billion in an Abu Dhabi offering last month, shortly after a $2 billion IPO from a unit of Oman’s state energy company. Those deals had disappointing starts — Lulu ended the day flat, and the Omani firm closed 8% below its offer price.
Talabat operates across eight countries - UAE, Kuwait, Oman, Qatar, Egypt, Jordan, Iraq and Bahrain. It has cemented its position in the region helped by Delivery Hero’s acquisition of Indian firm Zomato’s food delivery business in the UAE in 2019 and online grocery platform InstaShop in 2020.
Emirates NBD Capital PSC, JPMorgan Securities and Morgan Stanley have been appointed as joint global coordinators and joint bookrunners on the Talabat offering. Abu Dhabi Commercial Bank, Barclays, EFG-Hermes, First Abu Dhabi Bank, Goldman Sachs, ING Bank and UniCredit are joint bookrunners.
