Abu Dhabi, UAEMonday 26 August 2019

Network International IPO price range values firm at $3bn

Mastercard subsidiary to make $300m cornerstone investment in payments firm as part of the listing

Network International's headquarters in Dubai. Image courtesy of Network International
Network International's headquarters in Dubai. Image courtesy of Network International

Network international, one of the biggest payments processing companies in the Middle East and Africa, has set the price range for its initial public offering on the London Stock Exchange, valuing the company as much as $3 billion (Dh11.02bn).

The IPO offering range is set at 395 pence to 465 pence per share, implying a market value on admission to the exchange of between £1.98bn (Dh9.51bn) and £2.33bn, Network International said in a statement on Monday.

The expected institutional offer size comprises at least 125,000,000 shares, equating to a free float of at least 25 per cent of the company’s shares at the time of admission.

The sale will comprise the secondary offering of shares by Dubai’s biggest lender Emirates NBD, which holds 51 per cent in the company, and by Warburg Pincus and General Atlantic, which jointly own a 49 per cent stake in Network International.

Under the deal, shareholders granted Citigroup, one of the companies overseeing the listing, an option to purchase up to a maximum of 15 per cent of the total number of institutional offer shares.

The offer also comprises shares to be acquired by credit card issuer Mastercard, which agreed last month to invest $300 million through its wholly owned subsidiary Mastercard Asia-Pacific as part of the listing.

The cornerstone investment by the global payments company will be based on the same terms as other institutional investors participating in the IPO, subject to a 9.99 per cent ownership limitation, 24 months lock-up period and 36 months standstill period, during which they cannot acquire additional shares without Network International's consent.

The Mastercard investment is subject to conditions including an institutional free float of at least 25 per cent.

Network International’s listing comes amid a slow European IPO market, with investor appetite dented by concerns over Brexit and slower economic growth in Germany and France. European IPO volumes at the start of 2019 were at their lowest level since the financial crisis, according to data from Bloomberg.

At the same time, Middle East companies are increasingly looking to list shares on the LSE amid slow trading in local equities markets. The London bourse is home to Abu Dhabi’s NMC Health and Gulf Marine Services, among others.

The full details of Network International’s IPO will be included in the prospectus. The company expects to be eligible for inclusion in FTSE UK indices, following admission to LSE.

There will be a 180-day lock-up period for shareholders.

Citigroup, Emirates NBD Capital, JPMorgan Chase, Morgan Stanley, Barclays, Goldman Sachs, Liberum Capital and Evercore Partners law firm are working on the listing.

Updated: April 1, 2019 01:43 PM