IPOs and new listings on Dubai and Abu Dhabi financial markets
On 29 Aug 2007, WAM (the UAE news agency) reported that family run businesses in the UAE could now launch an IPO for a minimum of 30% of their share capital. This means they can keep a majority ownership of 70%. Previous minimum was 55% which meant such companies were reluctant to go for an IPO (Initial Public Offering) since they would lose majority ownership.
AGTHIA IPO - Emirates Foodstuff and Mineral Water Company - late 2004, AED 294 million.
Air Arabia IPO - 18-27 March 2007. 55% of total shareholding floated, AED 2.57 billion, largest in the UAE to date, foreign ownership to 49%. See also Air Arabia IPO discussion. Listed on DFM 17 July 2007.
NanoDynamics DIFX listing - reported 11 Jan 2008 as later in the year but a few days later said they'd list by the end of Jan 2008. Some IPO confusion (was cancelled in the USA in 2007), eventually they said Nano Dynamics IPO in the UAE Feb 2008. Then it got cancelled.
NetSol DIFX (NTWK) - secondary listing starts 16 June 2008, primary listing is on the Nasdaq in the USA.
ESCA - Emirates Securities and Commodities Authority
IPO - Initial Public Offering
KSE - Kuwait Stock Exchange
PJSC - Public Joint Stock Company
PSC - Public Stock Company
SCA - Securities and Commodities Authority (same body as ESCA)
Subscribing for shares in an IPO
To sign up or subscribe for shares in an IPO (Initial Public Offering), you'll need to do two things, in this order, if it's the first time subscribing for an IPO on one of the UAE financial markets. If you already have an investor card from the same market as the IPO company will list on, you just have to go to step 2.
Go to the financial market (DFM or ADSM) where the company will be listing after going public, and get an investor number. You can either do this directly, or some of the brokers will do this for you. The new investors page has information about the sign up procedure, and the subscription forms page has a list of forms you need. For a list of brokers, visit the UAE brokers page, and the UAE broker discussion forum for opinions and comments about some brokers.
Go to one of the receiving banks and collect the subscription forms. You should also be able to get a prospectus from the receiving bank. Fill in the forms and return them to one of the receiving banks with passport copies, investor card and copies, and any other requested paperwork.
The list of receiving banks should be included in the relevant discussion topic on Dubai Share Talk (see links below). It will be in the IPO prospectus, and probably in a press release or advertisement.
Non-UAE citizens can apply for IPO shares if foreign ownership is allowed (some companies restrict share ownership or sometimes just IPO subscription to UAE or GCC citizens only (e.g. DU Telecom IPO allowed foreginers to buy shares only after they'd listed on the stockmarket, not for the IPO). Usually GCC nationals have the same share ownership rights in the UAE as UAE nationals.
Foreigners without a valid UAE residence visa may be able to apply for IPO shares if foreign ownership is allowed. If it's not clear on the subscription forms, go to a receiving bank and try. Receiving banks may be inconsistent with information so if you are rejected at one, try at a different one.
Dubai and Abu Dhabi IPO discussion forum
IPO, subscription period, date of listing, % of total available for subscription, % available to retail investors, % available to foreign investors, number of times oversubscribed, funds collected, estimated profit from IPO, forecast earnings, DST link.
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