The company’s listing on the stock exchange through an Initial Public Offering in the Emirates is always a mixture of excitement and anxiety. For businesses, this is an opportunity to raise capital, consolidate market confidence and go beyond the usual boundaries. For investors, this is a chance to enter the project at an early stage, when the growth potential seems to be at its maximum. But every move requires discipline, attentiveness, and a willingness to face the unexpected.
What Is An IPO And What Are Its Stages In The Emirates?
An IPO is an initial public offering in which a private or public company offers securities to public investors for the first time. After listing, they are traded on a par with other issuers on the Dubai Financial Market, Abu Dhabi Securities Exchange or NASDAQ Dubai.
Three stages stand out especially clearly. The first is Pre-IPO: audit, IFRS reporting, selection of an investment bank, approval of the board of directors, and registration with SCA. The second is Pricing and Roadshow: determining the cost range, fixed-price or book-building, meetings with investors, presentations in Dubai, Abu Dhabi and abroad. The third is Post-IPO: the start of trading, market stabilization, and lock-up agreements for at least six months. And each of these links requires maximum precision.
Regulatory Requirements And Controls
A public company in the UAE is disclosing more data than ever before. ICFR controls financial processes, prevents mistakes and manipulations. SOX compliance is not mandatory, but many implement it voluntarily for the sake of the trust of global investors. IFRS regulates revenue recognition, and an independent audit ensures transparency.
Mistakes are expensive. Lack of automation, weak IT systems, and lack of separation of powers can lead to fines and reputational losses.
Investors And Their Strategies
Retail investors are active in the Emirates, but it is the institutional players who shape the market. Fixed-price models provide stability, book-building allows you to identify real demand. Oversubscription has become the norm: IPOs of Salik, DEWA and Americana showed a multiple excess of bids over supply.
In 2022, IPOs in the Emirates raised over $11 billion, and this was a historic figure. But every investor should be prepared for uncertainty. Someone gets shares, someone gets a refund. Therefore, it is important to issue a NIN in advance, link it with a broker, and even think about how to handle a UAE bank account opening so that funds for IPO subscriptions and refunds move quickly and without administrative delays.
Pre-IPO Investments And Risks
Before going public, wealthy individuals and foundations tend to join companies. The minimum amounts are significant: from AED 90,000 to AED 3,600,000. Admission is cheaper through SPV.
Brokers charge 2-5%, lawyers tens of thousands of dirhams, administrative costs are inevitable. Important metrics: revenue growth of 30% per year, gross margin above 75% for SaaS or 40% for marketplaces, Net Revenue Retention of 120%.
But the risk is obvious. Illiquidity. Long lock-up periods. A controversial assessment. And yet, with success, growth comparable to Americana Restaurants in 2022.
Corporate Governance And The Role Of Employees
The IPO changes the internal structure of the company. Employees with options face tax issues, trading rules, and liquidity planning. Boards of directors are strengthening control, reporting is becoming regular, and data disclosure is mandatory.
Alternative Ways
The classic IPO remains in the spotlight, but there are alternatives. Direct listing reduces costs, but deprives you of fresh capital. A Dutch auction is being discussed, but not yet applied. SPAC (Special Purpose Acquisition Company)is only gaining momentum: in Q4 2024, transactions through SPAC brought $3.8 billion to the region, setting a record since 2022.
An IPO in the Emirates is an examination of a company’s maturity. At the same time, it is a test for investors: their willingness to study the prospectus, accept volatility and risk, and play the long game.
The initial placement does not guarantee an easy profit. But it opens the door to capital, strengthens the Dubai and Abu Dhabi markets, and sets new rules for shareholders. An IPO is not a one-time deal, but a test where numbers and trust go hand in hand.
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