DP World nets $4.9bn in region’s biggest IPO

DP World nets $4.9bn in region’s biggest IPO

Dubai: Dubai ports operator DP World Ltd raised $4.96 billion (Rs19,542 crore) in West Asia’s biggest initial public offering (IPO).

The world’s fourth largest ports firm sold shares for $1.30 each—the top of an indicated range—after the IPO was oversubscribed more than 15 times, the firm said on Wednesday. That gives DP World a market value of $21.6 billion.

Dubai’s biggest step to date in establishing itself as a global financial centre surpasses Saudi Telecom Co.’s $4.1 billion IPO in 2003, and will spur interest in the sheikdom’s 2-year-old stock exchange as the government turns to asset sales to attract investors. Dubai has also bought stakes in Nasdaq Stock Market Inc. and London Stock Exchange Group Ltd as it vies with Qatar and Bahrain to be the region’s dominant markets player.

“We are delighted with the response," DP World chairperson Sultan Ahmed Bin Sulayem said. “The fact the IPO has been so heavily oversubscribed reflects the market’s confidence. DP World will have a solid base of international investors."

DP World boosted the size of the sale to 23% of its equity, from 20%, to meet demand. The money raised will help repay $3.5 billion of Islamic bonds and provide cash to the Dubai government. Prior to the IPO, the company had indicated it would sell the shares for $1-1.30 apiece. DP World, which began operations 35 years ago with a single port, bought London-based Peninsular & Oriental Steam Navigation Co. last year for $6.8 billion. It now has 42 terminals in 22 countries and a pipeline of new projects that will almost double capacity in 10 years as it seeks to catch up with Hong Kong’s Hutchison Port Holdings Ltd and Singapore’s PSA International Pte.