Delivery Hero’s Talabat Plans IPO on DFM Next Month

Delivery Hero, the Frankfurt-listed Germany-based company, on Sunday said that it has decided to offer 15% of the total shares of its subsidiary food delivery unit Talabat on the Dubai Financial Market (DFM) in Mid-December this year.

The company said that its Management Board, with the consent of the Supervisory Board, decided to pursue an Initial public offering (IPO), as announced on 29 August 2024. These shares and indirectly held by Delivery Hero which targets to list all of them on DFM.

Delivery Hero may amend the size of the offering subject to required approvals of the Securities and Commodities Authority of the UAE, the company said.

The public offering and listing would be made based on a local prospectus that has been approved by the Securities and Commodities Authority of the UAE on 7 November 2024 and published on Talabat’s website on Monday (11 November 2024).

Private placements to institutional investors would be made based on a corresponding international offering memorandum that would be published on Talabat’s website upon the start of the book building period.

Delivery Hero would retain the majority interest in Talabat, be subject to a lock-up of 180 days following the listing, be represented with half of the directors on the board of Talabat and continue to consolidate Talabat in its consolidated financial statements after implementation of the intended IPO.

Delivery Hero would use the IPO proceeds that depend on the number and price of Talabat shares to be sold by Delivery Hero 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.

The execution of the intended IPO remains subject to market conditions and further resolutions of the Management Board and Supervisory Board of Delivery Hero.

It may be recalled that Delivery Hero’s platform business in the MENA region achieved outstanding Gross Merchandise Value (GMV) top-line development of 28% y-o-y, fuelled by ongoing improvements to the ecosystem and customer experience.

Delivery Hero’s gross merchandise value, measuring the total value of all goods sold, increased by 30% across the MENA region in 3Q of 2024 and this performance came on the back of a 25% y-o-y increase in order volumes and affordability initiatives in this quarter.

Delivery Hero appointed Emirates NBD, Morgan Stanley, and JP Morgan to work on the upcoming IPO, with the possibility of adding more banks to its share sale.