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First property firm in Dubai to launch IPO since market crash
Damac Properties to raise $500 million.
November 5, 2013 5:42 by kippreport
As Damac Properties looks to broaden its investor base, the luxury developer has revealed its plans to raise approximately $500 million by selling global depositary receipts (GDRs) on the London Stock Exchange (LSE).
Each GDR, a certificate that represents a block of shares in a company, will be worth three ordinary shares in Damac.
A listing on the LSE would make Damac the first property firm from Dubai to conduct an IPO, since the market crashed in 2009. Citigroup and Deutsche Bank are advising the company on the float.
According to a statement, all shares in the issue will come from Hussain Sajwani, executive chairman and founder of Damac, who is selling part of his stake in the firm.
Commenting on the company’s announcement, Sajwani says that a GDR listing on the LSE is the next step in the firm’s evolution to take it to global markets and allow international investors to be part of the growth.
He adds: “We have created a strong platform and believe that we are well positioned to take advantage of the significant opportunities we see to further expand our proven business model in Dubai, as well as in other key markets in the Middle East region. The IPO represents a key stage in that process. ”
Damac Properties has recently been calling on banks in the UAE to allow international investors to purchase property in the market by providing a practical non-resident mortgage.
Managing director, Ziad El Chaar, told all banks in the UAE to “step up and support the market” by providing a non-resident mortgage to attract international investors, adding that banks are still “too timid”.