Qatari construction firm IHG to raise more than Dh500m through IPO
Qatar’s Investment Holding Group (IHG) plans to float on the country’s stock exchange, representing one of the first attempts by a family-owned firm to list on the exchange.
The group, which is chaired by Ghanim Sultan Al Hodaifi Al Kuwari, wants to offer 49.8 million shares, or just over 10 per cent of the 490.8 million shares that it will float, to investors. It has set a price target of 10.1 Qatari riyals for the IPO, meaning that it will raise 503 million riyals (Dh507.3m).
IHG’s roots stretch back to 1975. The group controls more than 30 different companies that are mainly involved in the construction industry, including a 51 per cent holding in main contractor Construction Development Contracting & Trading (CDCT), and majority stakes in Debbas Enterprise Qatar (51 per cent) and Electromechanical Engineering Company (68.5 per cent).
It also owns majority shares in specialist firms in engineering consultancy, landscaping, building materials and IT equipment. One of its companies, Al Hodaifi Group, is a local service agent for developers and main contractors including Spanish giant Obrascon Huarte Lain, UAE developer Damac and Saudi firm Al Saad General Contracting.
IHG said its decision to list on the exchange was owing to a desire to contribute to the local economy as well as broaden its shareholder base.
Mr Al Hodaifi said: "Our IPO is an opportunity to show how a family-owned business has managed to grow to become one of the most comprehensive contracting businesses in Qatar’s construction sector."
Wael Shtayyeh, the chief executive of IHG, said the listing represented the first case of a family business in Qatar transforming itself into a publicly-listed vehicle.
"Given the group’s long expertise in the Qatari construction sector, consistent growth and strong performance of its subsidiary companies, in addition to the wide positive economic indicators, we are confident that there will be a strong investor response to the subscription," he said.
IHG’s shares are being offered to Qatari citizens and to local companies approved by the Qatar Financial Markets Authority over a two-week period from next Sunday. The IPO is being handled by the Commercial Bank of Qatar.
The market for IPOs in the GCC was fairly sluggish in 2016. According to PwC’s most recent IPO Market Watch report, only three IPOs took place across the Gulf during the first nine months of the year.
Steve Drake, the head of PwC’s capital markets team in the Middle East, said: "While many companies have expressed interest in going public, they are still waiting for investor sentiment to improve."
( courtesy of TheNational )