Crypto firm Phoenix Group is next UAE IPO, with Dh1.3b offer opening November 16; price set at Dh1.5/share
Phoenix's is the first stock market float by a crypto business in the Middle East
Dubai: Abu Dhabi’s ADX will be getting back-to-back IPO listings, with the data center and crypto mining company Phoenix Group offering 17.64 per cent in the Dh1.36 billion stock market float. The subscription period for retail and institutional investors will start November 16 and close in two days, according to an ad published in the local media.
The offer price is set at Dh1.5, and marks the first opportunity for UAE investors get exposure in the emerging crypto services space. Licensed by Abu Dhabi Global Market, Phoenix operates the ‘UAE’s first fully-regulated digital asset exchange’.
Recently, the UAE investment entity IHC bought 10 per cent in Phoenix, which also oversees the operations of the data center facilities in the ‘Citadel Project’ based out of Abu Dhabi. (The Citadel Project is the Middle East’s ‘largest crypto-mining facility’ and covers around 100,000 square metres.
For UAE stock markets, the final quarter of 2023 is clearly feeling the buzz of IPO activity, with the subscription period for Investcorp Capital having closed yesterday (November 9) and ahead of a listing on the ADX.
"The Phoenix IPO represents the first opportunity for investors to gain exposure to the crypto and blockchain through a professionally managed and licensed entity," said Sameer Lakhani, Managing Director at Global Capital Partners. "It signals to investors the role that ADX and the UAE are carving out in this space as a result of their superior regulatory rules in the crypto domain.
"The IPO's tranche mix clearly shows the desire on the part of the firm to attract institutional investors with a deep understanding of the crypto industry."
Retail tranche
Retail investors need to put up a minimum of Dh5,000 (and in additions of Dh1,000 thereafter) for a share of the 6.67 per cent (or 60.48 million shares) assigned to them.
Market analysts say that Phoenix offers UAE investors the first taste of crypto-focussed growth opportunities from an entity that is part of the local corporate landscape. “The IHC’s 10 per cent stake buy in Phoenix was a significant moment and truly put the spotlight on the entity,” said an analyst. "This will also be the catalyst to garner institutional investor interest in the stock float."
Phoenix's revenue mix
“Despite crypto winter, sales remained robust in 2023, reflecting Phoenix’s agility and commitment to market expansion,” the company notes. Its trading operations fetched $161 million in 2021, and last year, that shot up to $715 million, helped by arrangements with the likes of Bitmain and MicroBT.
It was also the period when Phoenix put in the investment in a 250MW data mining facility in Abu Dhabi.
Data centers
It was 2020 when the entity ventured into data center operations. In the US and Canada, it currently has a combined 100MW capacity, and this year, expanded its international footprint to Oman, with a 150MW facility by partnering Green Data City.
More to follow...