Abu Dhabi launches AED 5 billion IPO fund

iStock [For illustration]

Abu Dhabi has launched a AED 5 billion IPO Fund to incentivise and support private sector companies to list on the emirate's stock market.

The fund will be overseen by the Supreme Council for Financial and Economic Affairs and managed by Abu Dhabi Department of Economic Development (ADDED).

It will invest in five to 10 private firms per year, with a focus on SMEs, and with a target ticket size of between 10 and 40 per cent of the float.

The initiative will act as a catalyst to strengthen Abu Dhabi Securities Exchange (ADX)’s position as a leading stock market.

The IPO Fund will work closely with local banks to leverage their expertise through the listing process, and will aim to add additional capital from private co-investors to enhance the proposition for listing companies.

The fund and private co-investors will hold the shares post-IPO for a reasonable period of time.

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