Dubai's Abraaj to sell Entertainer stake, sees IPO for Careem - CEO

Private-equity firm plans to launch global fund to focus on defensive, healthcare and education, says Arif Naqvi
Dubai's Abraaj to sell Entertainer stake, sees IPO for Careem - CEO
Arif Naqvi is the Founder and Group Chief Executive of The Abraaj Group.
By Staff writer
Wed 18 Jan 2017 10:04 AM

Abraaj Group, a Dubai-based private-equity firm, plans to offload its stake in discount voucher business The Entertainer this year, and expects ride hailing app Careem to eventually go for a public listing, company chief executive said on Tuesday.

The company acquired a 50 percent stake in The Entertainer in March 2012 through its $650 million (AED2.38 billion) small and mid-cap investment platform, Riyada Enterprise Development. It led a Series C investment of $60m (AED220.38m) in Careem in November 2015.

At present, Abraaj has nearly 100 companies in its portfolio. Group CEO Arif Naqvi, speaking to Bloomberg TV in Davos, said the company invests in between 20 and 25 a year, and divests a similar amount. He said the company is considering selling its stake in the Dubai-based voucher company.

“Right now there is a lot of conjecture on Entertainer which is the voucher service in the Middle East region. That is an exciting business and we are in the process of selling it,” he told the news outlet.

He said he expected that Dubai-based Careem will have to go for an initial public offering as it will require “more and more capital” to grow into the regional markets.

“Eventually that is what is going to happen because it is going to acquire a scale that is without question going to need more capital to grow as local differentiation is of critical importance,” he said.

Launched in Dubai in 2012 by Sheikha and fellow McKinsey & Co alumni Magnus Olsson, Careem has expanded across the Middle East, North Africa, Turkey and Pakistan.

It has a fleet of 90,000-plus drivers and more than four million users registered through its mobile app.

Naqvi revealed plans to launch a “global fund” with investment focus on defensive, healthcare and education. He did not give further details.

The firm has “a group of investors who have been supportive of us all the way through the last few years,” he said.

“We have a group of investors who have been supportive of us all the way through last few years. The hypothesis around our market continues to be a very strong and evolving one and investors see that with a lot of clarity,” he said.

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