ALEC Holdings Prices Its IPO At Top End, Raising AED 1.4 Billion Amid Strong Demand

ALEC Holdings PJSC, a prominent engineering and construction group, has finalised its IPO book building and subscription process as of 30th September 2025. The final offer price was set at AED1.40 per share, the highest point in the announced range. A total of 1 billion ordinary shares, representing 20% of ALEC's capital, were offered by the Investment Corporation of Dubai (ICD), raising AED1.4 billion (US$381 million) and valuing the company at AED7 billion (US$1.91 billion).

The IPO marks a significant milestone as it is the largest construction IPO in the UAE by both valuation and size, and the first in this sector in over 15 years. All shares offered are existing ones held by ICD, meaning ALEC will not receive any proceeds from this offering. Post-offering, ICD retains an 80% stake in ALEC.

The offering attracted substantial interest from a diverse group of high-quality investors, with total demand reaching approximately AED30 billion (US$8.1 billion). This resulted in an oversubscription rate exceeding 21 times across all three tranches. Notably, non-UAE investor participation was among the highest for recent government-related listings on the DFM.

Investors who participated in the Individual Subscribers Offering (First Tranche) and Eligible ALEC and ICD Employees Offering (Third Tranche) will be informed about their share allocations via SMS on 7 October 2025. Refunds are scheduled to begin on 8 October 2025.

ALEC plans to distribute a cash dividend of AED200 million in April 2026 and another AED500 million for financial year 2026, with payments scheduled for October 2026 and April 2027. Based on these figures and the final offer price, the dividend yield is expected to be 7.1% upon listing. Future dividends will be paid semi-annually with a minimum payout ratio of 50% of net profit, subject to board approval.

Barry Lewis, CEO of ALEC Holdings, expressed pride in the strong demand for ALEC’s IPO: "We are proud that ALEC’s IPO drew strong demand and significant interest from a diverse and high-quality investor base. This is a clear vote of confidence in ALEC’s distinct value proposition and disciplined operating model." He also highlighted investor confidence in the region's construction sector driven by ambitious national projects.

Regulatory Approvals and Trading Details

The completion of the offering and admission to trading on DFM under the symbol "ALEC" is anticipated on 15 October 2025, pending market conditions and regulatory approvals in the UAE. The ISIN assigned is "AEE01710A255".

An underwriting agreement dated 23rd September 2025 between ALEC, ICD, and Joint Bookrunners stipulates that remaining shares held by ICD post-admission will be subject to a lock-up period lasting until six months after admission.

Stabilisation Measures

xCube LLC has been authorised as a price stabilisation manager by DFM to manage proceeds from up to 100 million offer shares sold by ICD for potential stabilisation transactions on DFM. These actions will comply with applicable laws without involvement from Joint Bookrunners or their affiliates.

The Internal Shariah Supervision Committee of Emirates NBD confirmed that the offering aligns with Shariah principles. Emirates NBD Capital PSC and J.P. Morgan Securities PLC serve as joint global coordinators alongside other appointed bookrunners including Abu Dhabi Commercial Bank PJSC.

Banking Partners

Emirates NBD Bank PJSC has been designated as Lead Receiving Bank with several others like Abu Dhabi Commercial Bank PJSC participating as Receiving Banks for this IPO process.

With inputs from WAM