Alef Education IPO 39 times oversubscribed

• More than $20bn in orders
• Share price at upper limit
• Market cap of AED9.5bn

Orders totalling more than $20 billion were placed at the IPO of Abu Dhabi’s Alef Education this week, leaving it 39 times over-subscribed. 

The company raised AED1.9 billion ($515 million) in its initial public offering, the company said on Thursday. It will become the first education technology business to list on a UAE stock exchange.

The company sold 1.4 billion shares, or 20 percent of its stock, at AED1.35 ($0.37) a share, the upper limit of its price range.

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That valuation would give the company a market capitalisation of AED9.5 billion. The shares will make their Abu Dhabi bourse debut on or around June 12.

Alef says that some 1.1 million school students use its educational platform across 6,730 schools in the UAE, the United States, Indonesia, Jordan and Morocco.

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It provides “personalised learning experiences for all students so they learn at their own pace, anytime and anywhere,” the company’s website states.

The Middle East’s education technology sector will generate $11.2 billion in annual revenue in 2030, up from $5.6 billion in 2022, a report by US analyst Verified Market Research predicts.

Most Gulf companies that completed IPOs recently have seen their market capitalisation soar. Issuers have priced flotations adroitly to bolster investor demand for their stocks after listing.

From the start of 2023 to May 23, 2024, there had been 20 Gulf IPOs that raised at least $100 million. Combined, these sold $11.2 billion of shares.

As of that date, the share prices of 18 of these companies have increased since their listing. One remained flat and only one fell; Investcorp Capital, which was down 11 percent.