Alef Education, an Abu Dhabi-based education technology provider, is seeking a valuation of up to $2.57 billion in the first-ever listing of an edtech firm on the Abu Dhabi Securities Exchange (ADX).
This IPO will be the first in Abu Dhabi in 2024, underscoring the growing investor interest in the education technology (edtech) sector.
The IPO aims to raise as much as AED1.89 billion ($515 million), according to a Bloomberg report, marking a significant move to bolster its domestic business and expand its international footprintacco
IPO details and price range
The company said in a statement that the offer price range has been set between AED1.30 and AED1.35 per share for its IPO. Moreover, it stated that the IPO subscription period starts May 28, 2024.
At the top end, Alef Education would achieve a market capitalization of about $2.57 billion (9.45 billion dirhams) by listing 20% of its shares next month. The edtech plans to sell 1.4 billion existing shares held by its founders, tech investment firms Tech Nova and Kryptonite Investments, representing a 20% stake in the firm.
The IPO has seen substantial demand from investors, leading the selling shareholders to increase the first tranche offer to 140 million shares from 112 million. The second tranche offer will consist of 1.26 billion shares. The total shares on offer remain unchanged at 1.4 billion, equating to 20% of the company’s issued share capital.
“Our investment proposition has been incredibly well received by the market,” said Alef CEO Geoffrey Alphonso. “We are offering UAE and international investors the opportunity to participate in the growth of a leading and homegrown player in the underrepresented education technology sector.” Alphonso added that the listing “is an important milestone” in the edtech’s journey to “become a global edtech leader.”
IPO Timeline
- June 4, 2024 – First tranche subscriptions closed
- June 5 – Second tranche subscriptions closed
- June 6 – Final pricing announced
- June 12 – Expected listing on the Abu Dhabi Securities Exchange
- June 11 – Allocation, SMS confirmation and refunds commence
Alef Education – Expansion plans
Founded in 2016, Alef Education is a leading K-12 edtech company known for its AI-powered Alef Platform, which personalizes learning and provides real-time feedback for students and teachers. The platform is used by over 1 million students in more than 14,000 schools across the UAE, the U.S., Indonesia, and Morocco. The company plans to expand into Saudi Arabia and Egypt.
“Since its inception, Alef Education has played a pivotal role in advancing the UAE’s education landscape, delivering a significant, tangible, and positive impact for the students and education communities we serve,” said Abdulhamid Mohammed Saeed Alahmadi, Chairman of Alef Education‘s Board of Directors. He described the company as a trusted partner for both governments and education institutions, catering to their diverse and evolving learning requirements.
For the fiscal year 2023, Alef Education reported revenues of AED750 million, with an adjusted EBITDA margin of 65% and a profit margin of 61%.
Alef Education is indirectly majority-owned by Abu Dhabi Capital Group, one of the largest private institutional investment groups in the Middle East and North Africa (MENA). The listing will offer new investors a chance to be part of Alef Education’s future growth and success.
From virtual classrooms to massive open online courses (MOOCs), the education technology (EdTech) industry is rapidly transforming, projected to grow from US$146 billion in 2023 to around US$549.6 billion by 2033, with a CAGR (compound annual growth rate) of 14.2%.
