UAE family-owned firms planing IPOs
Two real estate-related companies in the UAE plan initial public offerings (IPOs) next year and a London listing amid renewed interest in UAE IPOs after a change allowing families to retain control.
Depa United Group, a Dubai-based interiors contracting company, aims to raise at least $400 million in the first half and list the stock on the Dubai International Financial Exchange (DIFX), and Global Depositary Receipts on the London Stock Exchange to "provide additional liquidity", Noor Sweid, a Depa United official, told Reuters on Tuesday.
Abu Dhabi-based Al Qudra Holding, which invests in industries including real estate and infrastructure, said it plans to sell about 25% of the company in the first quarter as it seeks to expand in the Arab world.
"We plan to continue our strategy of the last two years of expansion organically and through acquisition," said Sweid, whose Depa is considering $500 million of takeovers and related purchases during the next few years.
Chief Executive Mohannad Sweid owns 15% of Depa, which fits out luxury hotels and yachts. Last year, it won a $163 million contract to fit out apartments in Burj Dubai, the world's tallest building that the emirate's Emaar Properties is developing.
The UAE federation, of which Abu Dhabi and Dubai are the two biggest members, in August allowed families to retain as much as 70% of the firms they put up for sale to the public.
The earlier limit of 45% had discouraged UAE families, some of which have built up multi-billion dollar businesses on the back of oil-driven wealth, from selling shares.
Abu Dhabi-based Al Sayegh Brothers, whose five companies operate in industries including oil services, were among companies that said the change would probably encourage IPOs, demand for which has fallen in 2007 after surging for three consecutive years.
Al Qudra, set up in 2005 with share capital of 550 million dirhams ($149.8 million), plans to list its stock on the Abu Dhabi bourse, the firm's Chairman Salah Salem Al-Shamsi told Reuters by telephone on Tuesday.
"We are looking at Yemen, Syria, Morocco and Algeria," Shamsi said of the company's expansion plans.
Qudra profit last year tripled to 637 million dirhams after it expanded into real estate, according to its Web site.
"We will offload a small portion, about 25 percent, through a public share offering, sometime in the first quarter of 2008 and then list the company on the Abu Dhabi Securities Market," Shamsi said, declining to give details on how much the company is planning to raise.
Depa United Group, a Dubai-based interiors contracting company, aims to raise at least $400 million in the first half and list the stock on the Dubai International Financial Exchange (DIFX), and Global Depositary Receipts on the London Stock Exchange to "provide additional liquidity", Noor Sweid, a Depa United official, told Reuters on Tuesday.
Abu Dhabi-based Al Qudra Holding, which invests in industries including real estate and infrastructure, said it plans to sell about 25% of the company in the first quarter as it seeks to expand in the Arab world.
"We plan to continue our strategy of the last two years of expansion organically and through acquisition," said Sweid, whose Depa is considering $500 million of takeovers and related purchases during the next few years.
Chief Executive Mohannad Sweid owns 15% of Depa, which fits out luxury hotels and yachts. Last year, it won a $163 million contract to fit out apartments in Burj Dubai, the world's tallest building that the emirate's Emaar Properties is developing.
The UAE federation, of which Abu Dhabi and Dubai are the two biggest members, in August allowed families to retain as much as 70% of the firms they put up for sale to the public.
The earlier limit of 45% had discouraged UAE families, some of which have built up multi-billion dollar businesses on the back of oil-driven wealth, from selling shares.
Abu Dhabi-based Al Sayegh Brothers, whose five companies operate in industries including oil services, were among companies that said the change would probably encourage IPOs, demand for which has fallen in 2007 after surging for three consecutive years.
Al Qudra, set up in 2005 with share capital of 550 million dirhams ($149.8 million), plans to list its stock on the Abu Dhabi bourse, the firm's Chairman Salah Salem Al-Shamsi told Reuters by telephone on Tuesday.
"We are looking at Yemen, Syria, Morocco and Algeria," Shamsi said of the company's expansion plans.
Qudra profit last year tripled to 637 million dirhams after it expanded into real estate, according to its Web site.
"We will offload a small portion, about 25 percent, through a public share offering, sometime in the first quarter of 2008 and then list the company on the Abu Dhabi Securities Market," Shamsi said, declining to give details on how much the company is planning to raise.
Adviser
Dubai-based investment bank Shuaa Capital is advising Al Qudra on the share sale, Shamsi said, and Morgan Stanley and UBS AG are advising Depa, said Sweid.
Abu Dhabi-based The National Investor and Kuwait's Global Investment House, both of which have shares in Depa, are also providing financial advice, Sweid said.
Makram Kubeisy, managing director of investment banking at Shuaa, could not immediately be reached for comment.
"We are also looking at some Asian markets, like Vietnam and India, where the potential in real estate development is very good," said Shamsi. "It is a natural trend to go public to get the benefits of a publicly listed company."
Dubai set up the DIFX in 2005 to operate according to international regulatory standards to encourage local companies to sell shares to the public and for foreign companies to tap the region's oil-driven wealth.
Gulf Arab initial public offerings fell 4% in the first nine months to $5.9 billion as investor demand declined, especially in Qatar, Kuwait and Bahrain, said a report by Abu Dhabi-based private equity firm Gulf Capital, another shareholder in Depa.
On average, investors offered 6.1 times more - or $1.3 billion per sale - than companies were seeking to raise during the nine months to September 30, compared with almost 47 times more in the year-earlier period, Gulf Capital said.
It also cut its forecast for the value of announced and manager-assigned IPOs for the following three years to $7.9 billion, compared with $18.7 billion expected six months ago.
Gulf Arab companies raised $6.2 billion in the first nine months of last year, led by Saudi and UAE firms, and $7.5 billion in all of 2006, Gulf Capital said.
The average size of IPOs fell 38% to $227 million during the first nine months of this year, it said in the report received on Monday.
Saudi stocks sold this year and last year on average appreciated almost five-fold after listing. They almost tripled in Oman and more than doubled in the UAE, Gulf Capital said. - Reuters
Dubai-based investment bank Shuaa Capital is advising Al Qudra on the share sale, Shamsi said, and Morgan Stanley and UBS AG are advising Depa, said Sweid.
Abu Dhabi-based The National Investor and Kuwait's Global Investment House, both of which have shares in Depa, are also providing financial advice, Sweid said.
Makram Kubeisy, managing director of investment banking at Shuaa, could not immediately be reached for comment.
"We are also looking at some Asian markets, like Vietnam and India, where the potential in real estate development is very good," said Shamsi. "It is a natural trend to go public to get the benefits of a publicly listed company."
Dubai set up the DIFX in 2005 to operate according to international regulatory standards to encourage local companies to sell shares to the public and for foreign companies to tap the region's oil-driven wealth.
Gulf Arab initial public offerings fell 4% in the first nine months to $5.9 billion as investor demand declined, especially in Qatar, Kuwait and Bahrain, said a report by Abu Dhabi-based private equity firm Gulf Capital, another shareholder in Depa.
On average, investors offered 6.1 times more - or $1.3 billion per sale - than companies were seeking to raise during the nine months to September 30, compared with almost 47 times more in the year-earlier period, Gulf Capital said.
It also cut its forecast for the value of announced and manager-assigned IPOs for the following three years to $7.9 billion, compared with $18.7 billion expected six months ago.
Gulf Arab companies raised $6.2 billion in the first nine months of last year, led by Saudi and UAE firms, and $7.5 billion in all of 2006, Gulf Capital said.
The average size of IPOs fell 38% to $227 million during the first nine months of this year, it said in the report received on Monday.
Saudi stocks sold this year and last year on average appreciated almost five-fold after listing. They almost tripled in Oman and more than doubled in the UAE, Gulf Capital said. - Reuters
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