(Bloomberg) -- Abu Dhabi National Hotels plans to list its catering arm, adding to the growing number of initial public offerings in the Middle East.
The owner of hotels including the Ritz-Carlton and Park Hyatt in Abu Dhabi plans to offer 900 million shares — representing 40% of ADNH Catering’s share capital — in the IPO, which opens on October 7. The price range will be announced on the same day and the offer price will determined through a book building process, the company said in a statement.
The share sale could raise about $300 million to $400 million, Bloomberg News reported in July.
The IPO comes amid rising concerns over a broader conflict in the region. Still, the Middle East has seen a flurry of share sale announcements over the past months, including from an exploration and production unit in Oman, two flour millers in Saudi Arabia and a food delivery firm in Dubai.
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Stock markets too have largely held up despite rising geopolitical risks and falling oil prices. Abu Dhabi’s benchmark index has dropped 1.6% year-to-date, while over in neighboring Dubai, stocks have advanced 12% this quarter to the highest since 2014.
“I think the United Arab Emirates has historically been well protected,” Clive Cowley, the chief executive officer of ADNH Catering, said in an interview. “The economies have developed despite these historical tensions.”
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To help attract investors, the firm plans to pay out 60 million dirhams ($16.3 million) in dividends for 2024 and triple it to 180 million dirhams for 2025.
It also plans to expand its operations in Saudi Arabia to tap the growing population and the kingdom’s emerging position as an investment hub.
Citigroup Global Markets Ltd., First Abu Dhabi Bank PJSC, Emirates NBD Capital PSC and Abu Dhabi Commercial Bank PJSC will be the joint book runners for the issue.
The sole shareholder ADNH owns 12 hotels in the UAE and manages three others, according to its website. It generated revenue of 1.63 billion dirhams and a profit of 422.5 million dirhams in 2023.
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