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Burjeel Holdings is scaling down its initial public offering to a local affair after a firm controlled by Abu Dhabi’s royal family bought a stake in the health-care provider, according to people familiar with the matter.

Burjeel initially planned to file its intention to float a $750 million deal as soon as this week, but is changing its plans after International Holding Co. acquired the 15% stake earlier this week, the people said, asking not to be identified because the matter is private.

The offering will now target only local investors instead of international money managers, the people said. International Securities and First Abu Dhabi Bank are expected to manage the deal and replace EFG-Hermes Holding SAE, Emirates NBD Bank PJSC and JPMorgan Chase & Co., who had been mandated, the people said. 

Founded by doctor Shamsheer Vayalil and owned by VPS Healthcare LLC, Burjeel is set to be the first privately-owned firm to go public in the UAE this year. The Middle East is in the midst of an IPO boom that has bucked a global slowdown in listings due to high oil prices and equity inflows. So far, all of the firms that have listed in the UAE have been government owned.

Other Options

Final details of the IPO are still under discussion and may change, the people said. A direct listing where no funds are raised is also being considered, they said.

Representatives for Burjeel, Emirates NBD and JPMorgan declined to comment. Representatives for the other banks didn’t immediately respond to requests for comment.

IHC is the United Arab Emirates’ largest company by market value and is led by Sheikh Tahnoon Bin Zayed Al Nahyan -- the UAE’s national security adviser and brother to the country’s president. The value of the stake IHC acquired in Burjeel wasn’t disclosed.

Burjeel operates 39 hospitals and medical centers across the UAE and Oman. The company announced in August that it’s planning an expansion into Saudi Arabia -- the Gulf’s biggest economy -- with a $1 billion investment by 2030 through joint ventures and public-private partnership models.

VPS Healthcare had previously considered a plan to list in London but shelved that in 2019 due to the uncertainty surrounding Brexit. Another UAE medical firm that listed in London, NMC Health, was engulfed in scandal after it revealed more than $4 billion of undisclosed borrowings, and subsequently delisted from the London Stock Exchange.

(Updates with Emirates NBD comment in sixth paragraph)

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