According to Reuters, International Holding Company (IHC) plans to sell 20% of its technology unit in an initial public offering next year, with the UAE’s IHC aiming for a first quarter IPO of Pure Health to raise more than $1 billion.
IHC has been on a consolidation and acquisition spree since rising from relative obscurity to become the United Arab Emirates’ largest publicly traded company worth more than $200 billion.
As a result, two IHC subsidiaries now round out the top three companies on the Abu Dhabi Securities Exchange (ADX).
When asked about plans for International Technology Holding (ITH), Chief Executive Syed Basar Shueb stated that IHC will likely list 20% of it in the third quarter and is in discussions with local firms about possible acquisitions by the group based on IHC’s IT sector holdings.
Shueb predicted that ITH would turn over $500 million ($136 million) and have $1 billion in assets by the second quarter.
Sheikh Tahnoon bin Zayed al-Nahyan, the chair of IHC, is also the UAE’s national security adviser and has been a foreign policy troubleshooter for his brother, President Sheikh Mohammed bin Zayed al-Nahyan.
The company, whose market value exceeds that of Shell, Disney, and Nike, has been instrumental in increasing ADX’s size in the face of increasing competition from Saudi Arabia.
As cornerstone investors, IHC, its subsidiary Alpha Dhabi, ADX’s second largest firm, and other IHC-linked companies have played a leading role in a string of Abu Dhabi IPOs.
Pure Health, a subsidiary of Alpha Dhabi, plans to raise more than $1 billion in a first-quarter IPO, which has been postponed from this year.
“It will be more than $1 billion, but the size depends on how much we put in the market. I don’t think we can go above 10%, otherwise we will pull all the liquidity from market and this will affect the other players,” Shueb said.
Pure Health was a key player in the UAE screening for COVID-19. Its merger with state-owned Abu Dhabi Health Services (SEHA), which Shueb claims has nearly 24,000 employees, is taking longer than expected, causing the IPO to be delayed.
IHC, which completed four initial public offerings this year and plans a similar number in 2023, has yet to appoint banks for the Pure Health IPO, according to Shueb, and is considering an IPO of International Energy Holding in 2023.
IHC, which has interests ranging from real estate to farming, stated that the total value of its acquisitions in the third quarter exceeded 13.5 billion UAE dirhams, and it plans to acquire 70% more globally over the next year.
Shueb stated that it is in discussions with international banks for long-term financing for planned purchases in 2023, which would amount to a sizable portion of IHC’s cash position.
Some IHC businesses may eventually issue their own bonds, according to Shueb, without providing further details.
“We will have to create some debt on our balance sheet as well so that we can continue investing.”
Shueb stated that IHC is considering two potential investments in India totaling more than $2 billion, following a $2 billion investment in Adani Group companies in April.
Before the end of 2022, it may announce up to two international acquisitions and purchase a UAE-listed hospitality firm.
“We are looking at Colombia, and Asia – primarily Indonesia and India – these are the two major markets where we operate.”
This month, IHC’s bid to acquire a stake in Colombian food producer Nutresa fell through because it could not secure the desired stake size. IHC, according to Shueb, will continue to look for opportunities in other Latin American countries.
\(Adapted from AlArabiya.net)