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UAE’s deal-hungry IHC plans health and IT business IPOs

  • Pure Health IPO Raises Over $1B, CEO Says
  • Target tech unit IPO in 3rd quarter, with $1 billion in assets
  • Mulls IPO of International Energy Holding next year
  • Plan purchases this year and next, looking for substantial loan

ABU DHABI, Nov 24 (Reuters) – International Holding Company ( IHC.AD ) plans to sell 20% of its technology unit in an initial public offering next year, its chief executive told Reuters, adding that the UAE ‘s IHC is aiming for a first-quarter IPO of Pure Health to raise more than $1 billion.

IHC, which rose from relative obscurity to become the UAE’s largest publicly traded company valued at more than $200 billion, is consolidating and acquiring.

This resulted in two IHC subsidiaries rounding out the three largest companies on the Abu Dhabi Securities Exchange (ADX).

Asked about plans for International Technology Holding (ITH), chief executive officer Syed Basar Shueb said IHC is likely to list 20% of it in the third quarter and is in talks with local firms about possible acquisitions by the group born out of IHC’s IT -sector interests.

ITH was expected to turn over half a billion dirhams ($136 million) and have $1 billion in assets by the second quarter, Shueb said.

IHC is part of a business empire overseen by its chairman, Sheikh Tahnoon bin Zayed al-Nahyan, who is also the UAE’s national security adviser and was a foreign policy troubleshooter for his brother, President Sheikh Mohammed bin Zayed al-Nahyan.

The firm, whose market value is bigger than the likes of Shell, Disney and Nike, has been instrumental in increasing ADX’s size amid heightened competition from Saudi Arabia.

IHC, its subsidiary Alpha Dhabi, ADX’s second largest firm, and other IHC-linked companies have played a leading role in a series of Abu Dhabi IPOs as cornerstone investors.

Pure Health, under Alpha Dhabi, aims to raise more than $1 billion in a first-quarter IPO that has been delayed from this year.

“It will be more than $1 billion, but the size depends on how much we put into the market. I don’t think we can go above 10%, otherwise we will pull all the liquidity out of the market and it will affect the other players ,” Shueb said.

Pure Health played a major role in the UAE screening for COVID-19. Its merger with state-owned Abu Dhabi Health Services (SEHA), which Shueb says has nearly 24,000 employees, is taking longer than expected, delaying the IPO.

IHC, which has completed four IPOs this year and plans a similar number in 2023, has not yet appointed banks for the Pure Health IPO, Shueb said, adding that it is considering a possible 2023 IPO of International Energy Holding.

ACQUISITIONS

IHC, with interests from real estate to farming, said its total acquisition value exceeded AED 13.5 billion in the third quarter, and it plans 70% more globally over the next year.

Shueb said he was in talks with international banks for long-term financing for planned purchases in 2023, adding it would be equivalent to a significant portion of IHC’s cash position.

Some IHC companies may eventually issue their own bonds, Shueb said, without giving further details.

“We will also have to create some debt on our balance sheet so that we can continue to invest.”

IHC is eyeing two potential investments in India each worth more than $2 billion, Shueb said after investing $2 billion in Adani Group companies in April.

It could announce up to two international acquisitions and buy a UAE-listed hospitality firm before the end of 2022.

“We are looking at Colombia, and Asia – mainly Indonesia and India – these are the two big markets where we operate.”

This month, IHC’s bid to buy a stake in Colombian food producer Nutresa failed as it failed to secure the stake it wanted. Shueb said IHC will continue to look for opportunities in other Latin American countries.

($1 = 3.6729 UAE Dirham)

Reporting by Yousef Saba and Rachna Uppal; Editing by Alexander Smith

Our Standards: The Thomson Reuters Trust Principles.

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