DUBAI- Yahsat, the satellite company owned by Abu Dhabi's Mubadala, has attracted strong demand for its initial public offering (IPO) in the middle of an indicative price range, potentially raising about $735 million, three sources familiar with the deal said.

They said a final decision on the IPO price was likely to be taken later on Thursday by Mubadala, the state investor of Abu Dhabi, the biggest emirate in the United Arab Emirates.

If priced in the middle of the 2.55-3.05 dirham a share range, the deal could raise about 2.7 billion dirhams ($735 million) based on a maximum share sale of 975.9 million shares.

This will be the first major IPO on the Abu Dhabi bourse since Abu Dhabi National Oil Co Distribution was listed in 2017.

Al Yah Satellite Communications Co (Yahsat), set up in 2007, is one of the largest providers of satellite communications services in the world in terms of annual revenues, Mubadala has previously said. It also owns satellite phone operator Thuraya.

Yahsat is among the three portfolio companies that Mubadala is seeking to take public this year, sources previously told Reuters.

($1 = 3.6728 UAE dirham)

(Reporting by Hadeel Al Sayegh and Saeed Azhar; Editing by David Evans and Edmund Blair) ((Saeed.Azhar@thomsonreuters.com; +971 44536787; Reuters Messaging: saeed.azhar.reuters.com@reuters.net))