(Bloomberg) — Delivery Hero SE has unveiled plans to list its Talabat unit in Dubai in what could be one of the region’s biggest initial public offerings of the year.
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The German food delivery company plans to sell a 15% stake in its Middle Eastern subsidiary, according to a statement on Sunday, while retaining a majority stake. It could change the size of the offering, subject to approval by the United Arab Emirates Securities and Commodities Authority.
The deal could raise about $1 billion, Bloomberg News reported in September. According to a report from Bloomberg Intelligence, the IPO could value Delivery Hero’s “crown jewel” at as much as $12 billion, including debt.
Investors can place orders from November 19 to November 27 and the shares are expected to start trading in Dubai on or around December 10.
Talabat currently plans to pay a minimum dividend of approximately $100 million in April relative to fourth-quarter financial results, plus $400 million in two installments in October 2025 and April 2026, the statement said. Thereafter, dividends are expected to be paid twice per calendar year, with Talabat targeting a net income distribution of 90%.
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The IPO comes amid a wave of new share sales in the Middle East. Oman’s state energy company raised a record $2 billion last month by listing its exploration and production unit, and is preparing to sell stakes in its methanol business.
Private sector companies are also flocking. Lulu Retail Holdings Plc has raised $1.72 billion in the UAE’s biggest stock market listing of the year. IT services company Alpha Data is eyeing a stock exchange listing in Abu Dhabi, while online cosmetics retailer Nice One, healthcare provider Almoosa Health and technology company Ejada are preparing IPOs in Saudi Arabia.
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Talabat reported gross merchandise volume of $6 billion in 2023, up from just under $4 billion in 2021. Free cash flow rose 64% year-on-year to $226 million in the six months ended June.
Still, the entry of competitors could erode Talabat’s market share and valuation, according to Bloomberg Intelligence analyst Tatiana Lisitsina. She cited the example of Saudi company Jahez, whose profit prospects were hit by the arrival of Chinese food delivery giant Meituan. Although Talabat does not operate in the kingdom, lucrative Gulf markets could attract competitors, Lisitsina said.
