Dubai plans to list its main utility at $25bn valuation

Dubai is planning an IPO of shares in its main utility, the Dubai Electricity and Water Authority.

Dubai has staged just one initial public offering since 2017, and its only prospect of a listing this year fell through when logistics firm Tristar Transport pulled its offering in April [File: Christopher Pike/Bloomberg]

Dubai plans to sell shares in its main utility, valuing the firm at more than $25 billion in a deal that will rank among the emirate’s biggest listings, according to people familiar with the matter.

Dubai Electricity and Water Authority’s initial public offering is likely to be the first of many as the government tries to revive a flagging local bourse, the people said, asking not to be identified. DEWA, as the company is known, wasn’t immediately available for comment.

Earlier on Tuesday, deputy ruler Maktoum bin Mohammed bin Rashid said Dubai will sell a stake in DEWA “in coming months.” Shares will be listed “in stages” due to the utility’s size and profile in the economy.

The planned listing comes a day after Dubai said it would sell stakes in 10 state companies. It may prove a a test of confidence in a stock market dogged by falling volumes and at a time when regional rivals Saudi Arabia and Abu Dhabi are stepping up IPOs.

DEWA has more than a million customers in Dubai, according to its website. Along with its subsidiaries, it has assets worth up to 190 billion dirhams ($52 billion). It reported net income of 4.9 billion dirhams in 2019, the latest data available to Bloomberg.

Equity trading in Dubai has fallen in three of the past four years and a string of companies delisted. At the same time, the Covid-19 pandemic hurt the city’s lifeblood tourism and real estate industries.

Yet the economy has rebounded this year thanks to Dubai’s rapid vaccination drive and push to attract visitors. Rising oil prices have also buoyed Persian Gulf states more broadly.

Dubai has staged just one IPO since 2017, and its only prospect of a listing this year fell through when logistics firm Tristar Transport pulled its offering in April.

At the same time, flagship names such as port operator DP World have delisted. Others like Emaar Malls and Damac Properties are in the process of doing so.

–With assistance from Abeer Abu Omar and Anthony Di Paola.

Source: Bloomberg

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