By: Mahmoud Gamal
Dubai – Mubasher: UAE bourses are highly anticipating the resumption of initial public offerings (IPOs), as Emaar Properties’ ordinary general meeting (OGM) is scheduled to meet Sunday and announce listing a portion of one of its subsidiaries on the Dubai Financial Market (DFM).
IPOs in the UAE’s twin markets have been scarce of late following the sharp drop in oil prices in mid-2014, which negatively impacted a number of companies and their investments.
Emaar’s shareholders are set to discuss listing a 30% stake of the company’s real estate business Emaar Development.
UAE bourses are projected to see further IPOs and listings in the coming period as they are among the region’s most attractive bourses to foreign investors and the least impacted by economic fluctuations, analysts told Mubasher.
Emaar a market booster
Financial analyst at Menacorp Issam Kassabieh forecasts that Emaar Development’s IPO will be main market booster in the UAE in the coming period, indicating that the IPO was likely to attract inflows from both retail and institutional investors.
The IPO’s success will likely increase investor appetite in the UAE as well as pave the way for other successful IPOs that will boost market liquidity, the analyst told Mubasher.
Major foreign investments
Meanwhile, CEO of MindCraft Consultants Fadi El-Ghattis noted that the IPO of Emaar’s real estate business at this time indicates that local UAE bourses are gaining traction after periods of relative calm trading or “recession” in terms of IPOs.
He concurred with Kassabieh that the IPO will attract major foreign investments.
El-Ghattis told Mubasher that he expects the value of the IPO to range between AED 40 billion and AED 45 billion ($10.89 billion to $12.25 billion), highlighting that Emaar Development’s IPO is likely to be the largest IPO since Emaar Malls’ in 2014.
Meanwhile, SICO Investment Bank recently forecast that the value of the anticipated IPO will range between AED 22 billion and AED 28 billion (between $5.99 billion and $7.62 billion).
Emaar Development
Official data and statements released by Emaar Properties recently indicated that the portfolio of its wholly-owned subsidiary, Emaar Development, encompasses 31 projects.
Of these projects 19 are mixed-use developments, including seven residential complexes housings around 429 villas under development.
Translated by: Nada Adel Sobhi
