Talabat to Offer 20% Shares on Dubai Financial Market

Talabat, an indirectly fully-owned subsidiary of Delivery Hero, on Wednesday will be offering 20% of the issued shares (4,657,648,125) as against 15% (3,493,236,093) as announced a few weeks ago, to the investors on Dubai Financial Market (DFM).

The decision to increase the number of shares was taken by Delivery Hero’s Management Board, with the approval of the Supervisory Board and following the approval of the Securities and Commodities Authority of the UAE. Delivery Hero intends to retain a long-term majority indirect ownership position in Talabat.

Depending on the final offer price and based on the price range of $0.41 to $0.44 per share published on 18 November 2024, the gross proceeds to be received by Delivery Hero would be between $1.9 billion and $2 billion if all 4,657,648,125 shares of Talabat are sold. The final offer price is expected to be announced on 29 November 2024 and they will be traded on DFM from December 10.

According to Bloomberg, the market capitalisation for Talabat is expected to be around $10.2 billion. Emirates NBD, one of the banks on the IPO, previously said that Talabat could be valued at up to $14.4 billion, while Bloomberg Intelligence estimated an enterprise value of as much as $12 billion.

Talabat operates across eight countries – the UAE, Kuwait, Oman, Qatar, Egypt, Jordan, Iraq and Bahrain. It has cemented its position in the region helped by Delivery Hero’s acquisition of Indian firm Zomato’s food delivery business in the UAE in 2019 and online grocery platform InstaShop in 2020.

Emirates NBD Capital, JPMorgan Securities and Morgan Stanley have been appointed as joint global coordinators and joint book-runners on the Talabat offering. Abu Dhabi Commercial Bank, Barclays, EFG-Hermes, First Abu Dhabi Bank, Goldman Sachs, ING Bank and UniCredit are joint book-runners, the report said.

Delivery Hero would use the IPO proceeds for general corporate purposes and to further optimise its capital structure, the German company said.

First Dividend in April

Following the intended IPO, Talabat currently plans to pay a minimum dividend of approximately $100 million in April 2025 in respect of the financial results of Q4 of 2024 and of around $400 million in two instalments in October 2025 and April 2026 in respect of the financial results of 2025. Thereafter, Talabat intends to pay dividends twice each calendar year, in each case with a target net income pay-out of 90%. Delivery Hero would profit from any such dividend with its respective remaining majority stake in Talabat, the management said.