Investcorp Capital Plc, an investment vehicle backed by the Middle East’s biggest alternative asset manager, is looking to raise as much as 1.49 billion dirhams ($403 million) in an Abu Dhabi initial public offering.
The price range was set at 1.90 dirhams to 2.30 dirhams per share, according to a statement on Thursday. Investcorp Holdings is selling 321.5 million shares in Investcorp Capital, which is offering another 321.5 million new shares in the IPO. Together, that represents about a 29.3% stake.
The company has secured IVC Strategic Investment Co. as a cornerstone investor, who has agreed to buy about $250 million of the IPO, but did not specify who is behind the special purpose vehicle, describing it as an aggregator of orders from certain wealth management investors and a prominent Abu Dhabi-based institution.
Investorp Capital’s IPO comes at a time of heightened geopolitical tension in the Middle East with the ongoing conflict between Israel and militant group Hamas keeping investors on edge. Abu Dhabi’s benchmark index has shed 4% since the Oct. 7 attack on Israel by Hamas, although IPOs in the region have so far traded well.
The offering will be broken into two tranches, both for professional investors, with one closing Nov. 8 and the other Nov. 9. The company will price the shares on Nov. 10. Listing in Abu Dhabi is expected on Nov. 17.
Investcorp Capital invests in private equity, real estate, credit and general partner positions in North America, Europe, the Middle East and Asia. The company plans to use proceeds from the IPO to further develop its capital financing services business line and increase investments in capital deployment, and fund strategic growth opportunities.
It plans to pay an annual cash dividend equivalent to 8% of net asset exposure, which was $1.24 billion as of July 1, 2023.
Investcorp, which has backed luxury firms such as Tiffany & Co. and Gucci Ltd., delisted from the Bahrain stock exchange in 2021 after almost four decades due to low trading volumes and a desire to expand faster. Abu Dhabi’s Mubadala Investment Co. acquired a 20% stake in the company in 2017.
Originally set up to raise money from the Gulf to invest in the US and Europe, Investcorp has become more global in recent years. It has opened offices in Beijing, Singapore, Japan and India as it seeks to expand in Asia.
The firm has $50 billion in assets under management and counts some of the Middle East’s wealthiest royals and business moguls as its shareholders. Its businesses include private equity, real estate, infrastructure, credit management, strategic capital and absolute return investments.
Investcorp is working with Emirates NBD PJSC, First Abu Dhabi Bank PJSC and HSBC Holdings Plc as joint global coordinators and joint bookrunners. Moelis & Co. has been appointed independent financial advisor.
Goldman Sachs Group Inc. and Citigroup Inc. earlier dropped off the IPO because they couldn’t get internal approval for the IPO’s price stabilization mechanism, which has never been attempted before in a United Arab Emirates listing, Bloomberg News reported last week.
