Dubai’s ALEC aims for Dhs7bn valuation in highly anticipated IPO

ALEC Holdings PJSC (under conversion in Dubai, UAE) (“ALEC” or the “Company”), a market-leading diversified engineering and construction group, has officially announced the price range per share and the start of the subscription period for its highly anticipated initial public offering (IPO) on the Dubai Financial Market (DFM).

Read: IPO update: ALEC Holdings plans to list on Dubai Financial Market

This marks a pivotal moment for one of the region’s largest construction groups as it seeks to bring private-sector momentum and public investment under a unified capital strategy. The price range for the IPO has been set between Dhs1.35 and Dhs1.40 per share, implying a market capitalisation at listing of between Dhs6.75bn ($1.84bn) and Dhs7bn ($1.91bn), a Dubai Media Office report said.

The offering comprises 1 billion shares, representing 20 per cent of ALEC’s total share capital, which translates to an offering size of between Dhs1.35bn ($368mn) and Dhs1.40bn ($381mn).

All Offer Shares are existing shares, and no new capital is being raised by ALEC itself. The entire IPO represents a secondary sale by Investment Corporation of Dubai (ICD), the principal investment arm of the Government of Dubai.

ICD retains majority stake post-IPO

Post-offering, ICD will retain an 80 per cent stake in ALEC, assuming no increase in the offer size. The selling shareholder, ICD, retains the right to amend the Offering size at its sole discretion before the subscription period ends, in line with UAE laws and subject to Securities and Commodities Authority (SCA) approval.

This move is seen as a strategic monetisation of government-backed assets while retaining long-term control, in line with Dubai’s broader capital markets strategy to list prominent public-sector entities.

Dividend outlook: Yield of 7.1% to 7.4% implied

ALEC’s IPO is supported by a clear dividend policy, giving investors visibility on returns:

• A cash dividend of Dhs200m is planned for April 2026.
• A larger dividend of Dhs500m will follow for the full financial year ending 31 December 2026, paid in two equal tranches: one in October 2026, the other in April 2027.

Based on this projected AED 500 million payout, the implied dividend yield ranges between 7.1 per cent (at Dhs1.40/share) and 7.4 per cent (at Dhs1.35/share).

Going forward, ALEC plans to distribute dividends semi-annually, in April and October, with a minimum payout ratio of 50 per cent of net profit, contingent on the Board of Directors’ approval and the availability of distributable reserves.

Subscription breakdown across three investor tranches

The IPO is being marketed across three distinct tranches, each targeting specific investor groups:

1. Individual subscribers offering (First tranche)

Comprising 5 per cent of the total Offer Shares, this portion is open to retail investors and eligible entities holding a National Investor Number (NIN) on the DFM.

2. Professional investors offering (Second tranche)

Accounting for 94 per cent of the Offer Shares, this tranche targets qualified institutional investors outside the US under Regulation S, subject to UAE legal requirements and SCA oversight.

3. Eligible employees offering (Third tranche)

Reserved for 1 per cent of Offer Shares, this tranche is available to eligible employees of both ALEC and ICD.

In addition, 10 per cent of Offer Shares (deducted from the second tranche) are reserved for:

• Emirates Investment Authority (EIA) – 5 per cent
• Pensions Social Security Fund of Local Military Personnel (Fund) – 5 per cent

If either the EIA or the Fund declines to exercise its preferential rights, those shares will be made available to other Professional Investors.

Key dates and timeline to listing

• Subscription opens: Today, September 23, 2025
• Subscription closes: September 30, 2025 (all tranches)
• Final offer price announcement: October 1, 2025
• Expected listing on DFM: October 15, 2025

The final offer price will be determined via a book-building process, which is expected to reflect investor demand and market appetite.

Completion of the IPO is subject to market conditions and final approvals from relevant regulatory bodies in the UAE, including the SCA and DFM.

Lock-up periods and stabilisation mechanism

The IPO is governed by an Underwriting Agreement signed between ALEC, ICD, and the Joint Bookrunners. It includes lock-up provisions to ensure market stability:

• ICD’s remaining shares post-IPO will be locked up for 180 days, with certain exceptions.
• ALEC itself will also be subject to a 180-day lock-up following the Admission date.

To further support post-listing price stability, xCube LLC has been appointed by the Selling Shareholder to conduct stabilisation transactions on up to 100 million Offer Shares, if market conditions require.

Shariah compliance certification

In a bid to attract Islamic investors, the Internal Shariah Supervision Committee of Emirates NBD has issued a formal pronouncement that the Offering is compliant with Shariah principles.

This certification aligns ALEC with regional investor preferences and expands its appeal to Shariah-compliant portfolios across the GCC and beyond.

Lead advisors and receiving banks

ALEC’s IPO is being supported by a consortium of experienced advisors and financial institutions:

• Joint global coordinators and joint bookrunners:
  • Emirates NBD Capital PSC
  • P. Morgan Securities PLC
• Joint bookrunners:
  • Abu Dhabi Commercial Bank PJSC (ADCB)
  • EFG-Hermes UAE Limited & EFG Hermes UAE LLC (together “EFG-Hermes”)
• Independent financial adviser:
  • Moelis & Company UK LLP DIFC Branch
• Lead receiving bank:
  • Emirates NBD Bank PJSC
• Additional receiving banks:
  • Abu Dhabi Commercial Bank PJSC
  • Abu Dhabi Islamic Bank PJSC
  • Al Maryah Community Bank
  • Commercial Bank of Dubai PJSC
  • Dubai Islamic Bank PJSC
  • Emirates Islamic Bank PJSC
  • First Abu Dhabi Bank PJSC
  • Mashreq Bank PJSC
  • Wio Bank PJSC

Accessing the prospectus

Investors can access full offering documentation as follows:

• UAE Prospectus (for First and Third Tranches)
• International Offering Memorandum (for Second Tranche)

Available at: www.alec.ae/ipo

Summary: A strategic IPO with strong fundamentals

With its roots in large-scale construction and engineering projects across the UAE, ALEC’s IPO is expected to draw strong institutional and retail demand, bolstered by:

• Government ownership and backing
• Robust dividend policy and payout guidance
• Lock-up protections and stabilisation mechanisms
• Shariah compliance
• Broad accessibility through a diversified banking syndicate

The offering reflects a broader trend in the UAE’s capital markets, where high-profile, government-linked entities are being listed to boost market liquidity and offer long-term investment opportunities to a growing base of regional and international investors.