The Business of… 2010’s underperformers
Strikes, debt and defaults; 2010 hasn’t been kind to a lot of UAE businesses. Here is our pick of the biggest underperformers in 2010.
December 29, 2010 11:22 by shafeer
In what many called a brave move and a symbol of changing times (Kipp included), Axiom announced an IPO offering that would be the first the UAE had seen for two years. Many applauded the company for its confidence, cautiously thinking the worst is finally behind us. Then, just before the offering was due to take place, Axiom called off the whole thing.
Why? According to a statement released by Axiom: “While there were sufficient orders to fully cover the IPO book at the price range, primarily due to demand from high quality international investors in Europe and the U.S., there were widespread concerns about market conditions and liquidity. The board has therefore decided to withdraw the offer at this juncture to protect current and future shareholders of Axiom.” Plans to list on NASDAQ Dubai were also cancelled.
Most analysts were surprised (to a degree) by the cancellation. Axiom did attract enough interest to be fully subscribed (although bankers were reportedly still chasing investors in the hours leading up to deadline), with a valuation within the proposed range. But that valuation was on the extreme lower end of the range, and according to The National that lack of interest and the low price had Axiom worried that trading beyond the offering could be poor.