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Spinneys IPO Surges 11%, Eyes Saudi Expansion

Spinneys' IPO surges 11% in Dubai, attracting $19 billion in investor orders, signaling strong market appetite for private sector listings.

By Bill Bullington

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5/9, 02:33 EDT
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Key Takeaway

  • Spinneys' IPO surged 11% on its Dubai debut, with shares opening at 1.7 dirhams from an offer price of 1.53 dirhams.
  • The IPO attracted $19 billion in orders, highlighting strong investor demand for private sector listings in the UAE.
  • Plans for expansion into Saudi Arabia and strategic investment from Franklin Templeton underscore Spinneys' growth ambitions.

Spinneys' IPO Success

Spinneys 1961 Holding Plc, a high-end supermarket chain, experienced a notable surge of up to 11% in its Dubai trading debut, marking a significant moment for private sector initial public offerings (IPOs) in the United Arab Emirates (UAE). The company's shares opened at 1.7 dirhams, an increase from the offer price of 1.53 dirhams, which was already at the top of the marketed range. This performance is particularly noteworthy given the heavy demand from investors, with orders amounting to 71 billion dirhams ($19 billion) for the 1.38 billion-dirham share sale. Despite a slight decrease to a 7.2% gain by mid-morning, the IPO's success is seen as a positive indicator for other privately-held firms considering going public in the region.

Market Dynamics

The UAE has witnessed a flurry of listings since late 2021, predominantly from state-owned companies. Out of the 24 companies that have listed in the UAE since the beginning of 2021, only six, including Spinneys, were privately owned, according to data compiled by Bloomberg. This trend underscores the rarity of private sector IPOs in the region, with Spinneys' successful debut potentially paving the way for more private companies to consider public offerings. The last family-owned company to go public before Spinneys was Al Ansari Financial Services PJSC, which raised $210 million last year and is now trading approximately 3% above its offer price after initially rising as much as 23%.

Strategic Investments and Expansion

Spinneys attracted notable attention from international investors, with Franklin Templeton participating as a cornerstone investor. This level of international interest is relatively uncommon for UAE listings, with Fertiglobe Plc’s Abu Dhabi listing in 2021 being one of the few to draw significant foreign cornerstone investments. Owned by the Al Bwardy family, Spinneys has a long history in the region, opening its first store in 1961. Currently, it operates 75 supermarkets under the Spinneys, Waitrose, and Al Fair brands in the UAE and Oman. The company has announced plans to expand into Saudi Arabia, the Gulf’s largest economy, within the year, signaling its ambition to grow its footprint in the region.