Al Noor Hospitals, a private healthcare provider in Abu Dhabi, said it plans to raise $150 million in an initial public offering on the London Stock Exchange.
Al Noor Hospitals picks London Stock Exchange for $150m initial public offering
The proceeds will be used "primarily to finance future growth through acquisitions", it said yesterday.
The offering will include the issue of new shares by the company and a partial sale of existing shares held by some of the company's current shareholders.
Shareholders of Al Noor Hospitals, which include Dubai-based Ithmar Capital and Qatar First Investment Bank, had scrapped plans for a listing in 2011 amid weak market conditions. Yet speculation had mounted that the company was pursuing other options.
The healthcare industry in the UAE has experienced a surge of investment driven by a rapidly expanding population, rising incomes and a high incidence of chronic conditions such as cardiovascular disease and diabetes.
The collapse of property prices in 2008 combined with the fallout from the global financial crisis dampened corporate interest for listings on the Abu Dhabi Securities Exchange, Dubai Financial Market and Nasdaq Dubai.
Abu Dhabi's bourse has had only a handful of small share sales from the insurance sector, and Eshraq Properties, while the Dubai Financial Market and Nasdaq Dubai have not seen a public listing in the same period.
"We considered all options available, and thought carefully and the best decision was to list in London," said Sami Alom, the chief strategy officer at Al Noor Hospitals, in an interview. He cited the level of corporate governance standards, regulation and transparency among the reasons behind the move.
The proceeds will be used to acquire "specialised medical centres as well as a group of medical centres in the UAE", he said.
The group will begin an investor roadshow in two weeks. It plans to attract both foreign and regional institutional investors.
"We are going to the UK, EU, and possibly the US and the Gulf," Mr Alom said. Al Noor Hospitals has appointed Deutsche Bank and Goldman Sachs as joint sponsors and joint global coordinators. HSBC has been appointed as joint book runner, while Rothschild is "acting as financial adviser to the company", it added.
Al Noor Hospitals plans to apply for admission to the premium segment of the Official List of the UK Listing Authority and to trade on the main market of the London bourse.
Al Noor Hospitals' planned IPO follows public offerings by two Abu Dhabi-based companies in London over the past year.
Abu Dhabi Capital Management, an alternative investment firm, listed one of its funds on London's Alternative Investment Market. At the time, the company said that local markets do not have adequate liquidity to support such a listing and face numerous other hurdles in attracting business.
NMC Health, founded by the billionaire Indian entrepreneur BR Shetty, raised $187m in a share sale, winning a primary listing on the London Stock Exchange.
The UAE stock markets are now beginning to show signs of revival with volumes and asset values up in the past two years since the wake of the global financial crisis.
Brokers said the trend towards listing abroad showed a continued "lack of confidence" in the UAE market.
"I would have preferred like everybody else that the listing be in Dubai," said Fathi Ben Grira, the chief executive at Mena Corp, an investment company in Abu Dhabi.
"With the market improving here we hoped at least that issuers will look for dual listings because there is huge appetite for investors here."