Ithmar lines up greenfield healthcare IPO

Ithmar Capital, one of the UAE’s leading private equity groups, is planning to bring to market a “greenfield” initial public offering to exploit the region’s booming healthcare market.

The IPO, to be called Amanat (the Arabic word for “trust”), is expected to announce its intention to float on the Dubai Financial Market next month, according to an expert who was involved but asked not to be named because all the information is not yet in the public domain.

Amanat could be worth about Dh2.5 billion in market capitalisation, with some 55 per cent traded on the DFM and the balance retained by the founders, including Ithmar.

The project – the latest IPO to hit the DFM in a flurry of new listings on the exchange – is the brainchild of Faisal bin Juma Belhoul, the executive vice chairman of Ithmar, who has expertise and connections in the UAE’s growing market for hospitals, medical centres and pharmacies, and who also has interests in the education business.

Ithmar was one of the main shareholders of Al Noor Hospitals, which floated on the London Stock Exchange in July 2013. The shares have doubled in value in London since then, and Ithmar recently took some of the profit on its investment with the sale of a 7.3 per cent stake in Al Noor, worth some £88 million (Dh526.5m).

Ithmar retains a 20 per cent holding in Al Noor, which could form the nucleus of the Amanat portfolio. The strategy will be to use the proceeds from the IPO to take over existing medical facilities or build new ones in the Emirates. Capital could also be channelled into the educational sector.

The source said the IPO would be a traditional DFM flotation, adhering to regulatory rules that insist 55 per cent of the shares are offered for sale. The balance would be held by the Amanat founders, including Ithmar.

Ithmar has not sought the “Emaar exemption”, by which the property developer was allowed to sell a smaller percentage in the current IPO of its malls business.

Amanat is said to have hired Credit Suisse and Deutsche Bank to advise on the IPO, although that could not be confirmed. Executives at both banks declined to comment.

The UAE healthcare market is set for a period of strong expansion, according to industry experts, who expect annual growth of up to 19 per cent for the next three years. The sector is benefiting from official policymakers’ encouragement to tackle traditional “regional” diseases like obesity and diabetes, while simultaneously positioning the UAE as a centre for medical tourism in the Middle East.

Plans are advanced for other IPOs in booming UAE markets. Gulf Capital, the Abu Dhabi investment group, is said to have won initial approval from the Securities and Commodities Authority (the UAE regulator) for a flotation on the Abu Dhabi Securities Exchange, and a draft prospectus has been prepared.

But shareholders in the company, which earlier this year floated its Gulf Marine subsidiary in London, have still to decide how many of the shares to sell down in the issue. The IPO needs approval from regulatory and other authorities in the capital.

Meanwhile, Meeras Holding, the Dubai government-owned developer, is believed to be in the final stages of preparing an IPO for its theme parks division, which could be worth Dh6bn.

With advisers Goldman Sachs, HSBC and EFG Hermes it is assessing how much of the share capital to float, from a range of 30 to 55 per cent.

The assets of the business consist of land granted by the Dubai Government near the new World Central airport and the contracts with international leisure groups to develop a theme park complex in Dubai based on Hollywood, Bollywood and Legoland.

The company is said to be assessing the value of these assets, but has already fought SCA approval for the IPO, tipped for a December launch.

fkane@thenational.ae