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Abu Dhabi’s Eshraq plans $224 mln IPO in Feb -banker

First IPO in UAE in nearly two years.

January 5, 2011 4:45 by



UAE property firm Eshraq plans to sell a 55 percent stake worth an estimated $224 million in an initial public offering in February and list on the Abu Dhabi stock exchange, a banker close to the deal said on Wednesday.

The Abu Dhabi-based banker, speaking on condition of anonymity, said several UAE banks are involved in the IPO which will offers 825 million shares. Eshraq has a total capital of 1.5 billion dirhams ($408.4 million), he told Reuters.

“After the IPO, the shares will be listed on ADX,” he said.

The UAE markets have not seen an IPO in about two years as the global economic downturn and Dubai’s debt crisis dented investor appetite.

United Arab Emirates handset retailer Axiom Telecom cancelled its IPO in December, citing “market conditions and liquidity” concerns. Earlier, Axiom had said it expected to debut on NASDAQ Dubai in early December with a market value of up to $1 billion.

Asked whether there would be enough investor interest in the deal, the banker replied: “It is a concern to all of us.”

“The promoters are confident that there will be interest but if it is not fully subscribed, the founders have a right to fill the gap as per law,” the banker said.

Eshraq’s chairman Saleh Mohammed Bin Nasrah was quoted on the website of Arabic-language daily Al-Bayan newspaper on Wednesday as saying the firm had already won approval from the Securities and Commodities Authority to become a public shareholding company.

Bin Nasrah said the firm would offer 820 million shares to the public. He also said the company had been profitable in the past few years and paid dividends to its stockholders, without giving specific amounts.

Eshraq’s biggest project is Marine Rise, a 21-high rise complex on Abu Dhabi’s Reem Island. Bin Nasra said 80 percent had been sold to secondary developers.

(Reporting by Stanley Carvalho; additional reporting by Martina Fuchs and Rachna Uppal in Dubai; editing by Firouz Sedarat)



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