Alef Education Set To Be The Third IPO In The UAE for 2024, Marking The First Such Offering In Abu Dhabi

Alef Education

Alef Education Holding is launching its initial public offering (IPO) in the UAE, releasing 1.4 billion shares, which constitute 20% of its equity capital. The subscription period is scheduled from May 28 to June 4. This IPO will also be the inaugural listing of the year on the Abu Dhabi Securities Exchange (ADX).

Alef Education, known for its AI-enhanced educational solutions, is indirectly controlled by a majority stake from Abu Dhabi Capital Group. The company has achieved full market penetration in public schools for Cycle 2 (Grades 5-8) and Cycle 3 (Grades 9-12) and holds a 40-50% share in the private school sector across the UAE, according to a recent announcement.

Tech Nova Investment – Sole Proprietorship LLC and Kryptonite Investments LLC are the entities offering their shares through this IPO. Alef Education has announced an ambitious dividend strategy, planning to distribute a minimum of 90% of its net profits as dividends for 2024 and 2025.

The anticipated date for the ADX listing is around June 12. Abdulhamid Mohammed Saeed Alahmadi, the Chairman, highlighted the rapid expansion of the global ed-tech market, driven by increased governmental spending and initiatives that incorporate digital and AI technologies to revolutionize education and learning processes.

Earlier this year, Parkin and Spinneys marked the beginning of the UAE’s IPO season in Dubai, attracting substantial interest from investors. Alef Education has allocated 8% of its IPO for retail investors, with the remainder for institutional investors, and guarantees 2,000 shares for each subscriber. The company could adjust the size of the offering or the allocation of shares at any point during the subscription phase.

Furthermore, Alef Education has decided on a semi-annual dividend distribution policy, with payments scheduled for the fourth quarter of a year and the second quarter of the subsequent year. It aims to distribute a minimum of Dh135 million in dividends between 2024 and 2025. If necessary, to ensure that all shareholders receive the projected dividends, selling shareholders may waive their dividend rights, complying with AAOIFI Shariah standards, to meet these targets.

Geoffrey Alphonso, CEO of Alef Education, stated that the company’s efficient, asset-light business model allows it to generate substantial cash flow and sustain growth with minimal capital investment. With a strong balance sheet, leading profitability margins, and robust revenue projections, Alef Education is well-placed to leverage favourable market conditions to expand its platform, accelerate growth, and create enduring value for all stakeholders.

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