Mubadala Divests 7.55% Stake in du Through Secondary Offering
Introduction to the Offering
Mubadala Investment Company, a key player in Abu Dhabi’s investment landscape, is taking a significant step by selling a 7.55% stake—equivalent to 342 million shares—in Emirates Integrated Telecommunications Company, commonly known as du. This sale is facilitated through its subsidiary, Mamoura, and will be conducted as a secondary public offering on the Dubai Financial Market, where du’s shares are publicly traded.
Investor Participation Breakdown
This offering is structured to attract a diverse set of investors. Approximately 5% of the shares are available to retail investors in the UAE, while 95% are reserved for qualified institutional investors, not only within the UAE but also in various jurisdictions outside the United States. This dual approach is designed to broaden investor access and engagement with du’s stock.
Pricing and Offer Details
The price range for the shares has been established between AED 9.00 and AED 9.90 (roughly $2.45 to $2.70). The final pricing will be determined through a book-building process, with official announcements set for September 15. Should the shares reach the upper limit of AED 9.90, Mubadala stands to gain around AED 3.385 billion, which translates to about $921 million.
Impact on du’s Market Position
For du, this secondary offering is expected to enhance its market dynamics by increasing the free float of its shares, ultimately contributing to improved liquidity. Notably, the company will not receive any proceeds from the sale, and this transaction will not dilute its existing ownership rights.
Insights from du’s Leadership
Fahad Al Hassani, CEO of du, remarked on the inherent value this offering presents to both retail and institutional investors. He highlighted how the company’s focused strategy has successfully led to impressive financial and operational performance. Al Hassani believes this initiative will heighten du’s free float, thereby attracting more investors and fostering trading activity. This could potentially pave the way for du’s inclusion in significant international indices.
Mubadala’s Vision for Investment
Dr. Bakheet Al Khateeri, CEO of Mubadala’s UAE Investment Platform, emphasized the role of Mubadala in advancing the national economic agenda. He noted the firm’s nearly 20-year commitment to du, helping the organization emerge as a champion in the telecommunications field and a critical player in the UAE’s digital economy. Al Khateeri claims this transaction sets a new global standard for secondary offerings in the region, enhancing investor involvement and allowing for responsible capital redeployment.
du’s Financial Performance
Recent reports indicate that du has demonstrated consistent growth, reflecting its solid business strategy. In the first half of 2025, revenue increased by 8% year-over-year to AED 7.8 billion. Their EBITDA saw a notable surge of 16% year-on-year, reaching AED 3.7 billion, which translates to a margin of 47%. Additionally, net profit climbed by 22% year-on-year, hitting AED 1.4 billion, while operating free cash flow stood at AED 2.7 billion.
Subscription Period and Application Process
The subscription period for the UAE Retail Offer commenced today, September 8, at 9 AM UAE time and will close at noon on September 12. The minimum subscription amount is set at AED 5,000, with increments available at AED 1,000 for additional applications.
For Qualified Investors, the subscription window is open from today until 3 PM on September 12.
Key Financial Institutions Involved
A number of prominent financial institutions are collaborating in this offering. Abu Dhabi Commercial Bank, Emirates NBD Capital, First Abu Dhabi Bank, and Goldman Sachs International are serving as Joint Global Coordinators and Bookrunners. Emirates NBD Bank has been designated as the Lead Receiving Bank, while several additional banks, including Abu Dhabi Islamic Bank and Dubai Islamic Bank, have also been appointed as Receiving Banks.
Conclusion
The strategic sale by Mubadala reflects a robust approach to capital markets, reinforcing the growth trajectory of du while broadening its investor base. This initiative not only enhances market liquidity but also marks a significant milestone for the UAE’s capital landscape.
