Delivery Hero’s Talabat to IPO on the DFM in December

Delivery Hero is selling a 15% stake of Middle East food delivery unit Talabat in an IPO on the Dubai Financial Market (DFM) in mid-December, the company said in a statement. The transaction is expected to exceed USD 1 bn, Reuters reports, citing people it says are familiar with the matter. The company is issuing a prospectus today.

What we know: The German last-mile delivery company plans to retain a majority stake in Talabat, with a lock-up period of 180 days following the listing.

Talabat’s valuation could hit somewhere between EUR 11.5-13.5 bn, managing director of equity research firm Jefferies, Giles Thorne, said. These figures exceed previous expectations of Bloomberg Intelligence which put the valuation between USD 9-12 bn.

The Berlin-based company’s MENA activities are flourishing: Delivery Hero’s gross merchandise value, measuring the total value of all goods sold, increased by 30% across the MENA region in 3Q 2024, according to a statement. This performance came on the back of a 25% y-o-y increase in order volumes and affordability initiatives in this quarter.

Dividends: Post-IPO, Talabat aims to distribute dividends amounting to 90% of net income, starting with a minimum payout of USD 100 mn in April, according to the statement. Additional installments totaling USD 400 mn are scheduled across 2025 and 2026.

ADVISORS- 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.

THE DFM PIPELINE AT A GLANCE-

• Construction firm Alec tapped advisors for a planned IPO;
• Amanat Holdings is looking to list its education and healthcare units, with reports that its healthcare unit could raise around USD 200 mn in 2024;
• Hospitality group Five Holdings and Dubai-based platform Dubizzle Group also tapped advisors for a potential IPO next year;
• Shisha producer Advanced Inhalation Rituals is also eyeing an IPO.