Tuesday’s statement from the region’s first mortgage company is in response to the booming property market in Dubai.

AMLAK officials said they will raise capital to 750 dirhams ($204 million) and will offer 55%, or 412,500,000 shares, at a price of one dirham (27 cents) per share.

Founding shareholders EMAAR Properties, will retain a 45% stake in the company.

"The IPO, which opens on 18 January for a 10-day period, invites UAE national and expatriate investors to gain exposure to the dynamic UAE real estate sector, while the transfer to Shariah-compliant operations will ensure a solid investment opportunity for the growing pool of Islamic funds in the region," AMLAK chairman Muhammad Ali Alabbar said in a statement.

AMLAK reported a 300% profit increase during 2003, its third year of operation, to 14 million dirhams ($3.8 million).

Fiscal growth

The company also saw its loan book grow to 1.5 billion dirhams ($410 million), with a total of 550 million dirhams ($150 million) now disbursed.

"We expect to see a very strong investor appetite with prospects of high returns in this sector. We expect the IPO to be a major success," added Alabbar who is also director general of the Dubai Department of Economic Development.

He also noted that the company has already received strong interest from regional Islamic institutions keen to enter the real estate market in a Shariah-compliant manner.

"We are delighted to be able to offer Islamic investors a new opportunity to tap into the huge potential of this sector in a manner which meets their cultural and ethical needs," he said.

Alabbar said the transfer process would not affect existing clients and that the key terms of all existing account holders would remain with only minor modifications to their documentation.

Established in October 2000 as Dubai allowed foreigners to buy property, AMLAK is the first financial services company in the region to specialise in the provision of mortgages.