Individual investors from outside the UAE can participate in the highly anticipated Lulu Retail initial public offering (IPO), which opens for subscription on October 28.
According to the FAQs on Lulu Retail’s website, foreign investors are eligible to subscribe, provided they meet the qualification criteria established by the regulator.
The Abu Dhabi-based pan-GCC retailer is offering 25% of its shares in the IPO at a nominal value of Dh0.051 each. A total of 2.582 billion (2,582,226,338) shares will be sold in a three-tranche IPO, running from October 28 to November 5. The final offer price will be announced later, and the shares will be listed on the Abu Dhabi Securities Exchange.
How to Subscribe
Retail investors from the GCC and other countries can take advantage of a retail option available for Lulu Retail’s IPO. More detailed information can be found in the FAQ section on the company’s website.
To subscribe, investors outside the UAE can approach local stock brokers or the designated receiving banks. These banks include First Abu Dhabi Bank, Dubai Islamic Bank, Emirates Islamic Bank, Abu Dhabi Commercial Bank, Mashreq, and Emirates NBD.
The joint lead receiving institutions are Abu Dhabi Commercial Bank and First Abu Dhabi Bank, while the joint lead managers are Abu Dhabi Commercial Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC Bank Middle East, and EFG Hermes UAE.
For those wishing to participate in the IPO, retail investors must first obtain a National Investor Number (NIN), which is available through UAE brokerage firms. Guidelines on how to get an NIN and other procedural details are available on UAE brokerages’ websites. Indian investors can also subscribe to the Lulu IPO, subject to Indian regulations.
Investors outside the UAE who wish to subscribe to the IPO need to first obtain a NIN from the Abu Dhabi Securities Exchange (ADX). They can then complete their subscription through electronic platforms like online or mobile banking offered by participating banks.
Joseph Dahrieh, managing principal at Tickmill, explained: “The minimum subscription amount for individual investors in the First Tranche is Dh5,000, with additional investments made in increments of Dh1,000. Investors should also ensure they comply with the legal requirements of their home countries before participating.”
Three-Tranche IPO
In the first tranche, aimed at individual subscribers and eligible employees, 258.222 million shares (10% of the offer) will be available. Individual subscribers, excluding eligible employees, will be guaranteed a minimum allocation of 1,000 shares, while eligible employees will receive at least 2,000 shares. The minimum subscription for this tranche is Dh5,000, with any additional applications to be made in increments of Dh1,000. There is no maximum application size.
In the second tranche, reserved for institutional investors, Lulu Retail will offer 2,298,181,441 shares, representing 89% of the total offer. The minimum application size for this tranche is Dh5 million, with no maximum application size.
The third tranche, which is for senior executives, will offer over 25.822 million shares (1% of the total offer). The minimum subscription for this tranche is Dh50,000, with additional applications in increments of Dh1,000. Like the other tranches, there is no maximum application size.
Similar to previous IPOs, analysts and industry experts predict high demand from both retail and institutional investors, with strong oversubscription expected next week.
