NDBIB rings in success through Rs. 2.8 b IPO in Maldives

Wednesday, 27 November 2019 08:05 -     - {{hitsCtrl.values.hits}}


NDB Investment Bank (NDBIB), acting as the Sole Financial Advisor and Manager, successfully completed the Initial Public Offering (IPO) of Maldives Islamic Bank Plc (MIB), the only fully-fledged Islamic Bank in the archipelago. 

MIB’s IPO, while raising MVR 244.1 million, was NDBIB’s second successful IPO in the Maldives and further elevated the investment bank as the only Sri Lankan advisor to have executed an IPO on foreign soil. 

The IPO was oversubscribed by 1.5 times and the shares of MIB began trading on the Maldivian Stock Exchange after a gala bell-ringing ceremony on 17 November in the country’s capital of Malé.

The IPO was ceremonially launched on 28 July and closed on 22 September upon the expiry of the offer period stipulated by Maldivian regulations with strong institutional and retail participation.

NDBIB CEO Darshan Perera, expressing his thoughts on the success of the IPO, stated: “The IPO of MIB resonates our commitment to delivering value to customers. Staying true to our promise, we have delivered exceptional results and made history in the capital markets of the Maldives. We look forward to raising debt and equity capital to enable growth as part of our strategy of regional play.” 

The IPO of MIB is the second such transaction managed by NDBIB in the Maldives subsequent to that of Ooredoo Maldives Plc, a subsidiary of the Ooredoo Group, a Qatar-based global telco. MIB listed on the Maldives Stock Exchange (MSE) and raised MVR 244.1 million (equivalent to Rs. 2.8 billion) from the public by offering 6,975,000 Ordinary Shares at a price of MVR 35.00 per share. 

NDBIB Chief Corporate Advisory Officer Nilendra Weerasinghe stated: “The right distribution strategy was critical to the success of MIB’s IPO. We achieved record retail participation, attracting over 16,000 applications from 20 atolls covering 144 islands. This was possible by leveraging MIB’s resources, including the branch network and ‘Infinity’, the online application portal of the Maldives Stock Exchange. Over 34% of the total applications were processed via the Infinity portal, an astounding achievement for a capital market still at its nascent stage.”

MIB issued 4,500,000 new Ordinary Shares, raising MVR 157.5 million while a further 2,475,000 Ordinary Shares of the majority shareholder were sold raising MVR 86.6 million. The equity raised strengthened the bank’s capital base and will enable growth in its financing portfolio. The sale of shares facilitated MIB’s majority shareholder, Islamic Corporation for the Development of the Private Sector (ICD), to comply with its internal investment policy guidelines for shareholding in portfolio companies. Additionally, the IPO broad-based the ownership of MIB, giving an opportunity to the Maldivian public to be part of the growth prospects of the bank.

NDBIB Vice President and team lead for the transaction, Viraj Wijesinghe, said: “Our experience during the Ooredoo IPO and extensive investor education efforts helped us provide a market accepted valuation and switch the investor focus from dividend yield to both dividend and capital gains. MIB was priced at 1.85 times book value while its only listed peer was trading at a steep discount to that multiple and offering a much higher dividend yield. We once again raised the bar for IPO documentation by delivering a high quality prospectus in line with regional best practices, continuing from our previous IPO of Ooredoo Maldives.” 

NDBIB is the investment banking subsidiary of NDB Capital Holdings, the largest full service investment banking group in the country holding a complementary business portfolio consisting of fee-based and fund-based investment banking, wealth management, private equity management and stock broking. NDBIB has been awarded the ‘Best Investment Bank in Sri Lanka’ by the prestigious Euromoney Magazine for eight consecutive years, the first and only Investment bank in Sri Lanka to have received this award.