Meraas to list Dubai Parks and Resorts on DFM

Dubai Parks and Resorts, a subsidiary of Meraas Holding, on Tuesday announced plans to launch an initial public offering and list its shares on the Dubai Financial Market (DFM).

The offering will comprise 2,528,731,083 ordinary shares, representing 40 per cent of the company’s post-offer issued share capital. The offer price is Dh1 for each share plus Dh0.01 per share in offer costs; inferring a total offer size of approximately Dh2.5 billion which, when added to the ordinary shares to be applied for by Meraas Holding, will result in a market capitalisation on listing of approximately Dh6.3 billion.

Dubai Parks and Resorts will be a multi-themed leisure and entertainment destination that will offer 73 attractions in three separate theme parks, a four star resort hotel (to be known as Hotel Lapita), and Riverpark, a complementary and centrally located retail, dining and entertainment district connecting the three theme parks and hotel.

It will be set in approximately 16 million square feet of land. In addition, the company has all necessary easements in respect of approximately nine million square feet of land which will principally be used for access roads and parking.

The project is currently anticipated to be completed before the end of the third quarter of 2016 and the total estimated number of visits in the first full year of operation in 2017 is approximately 6.7 million, with significant growth expected over the following four-year period.

The three theme parks will comprise motiongate, a Hollywood inspired theme park concept based on major DreamWorks Animation and Sony Pictures Consumer Products movies; Legoland Dubai, the first theme park in the Middle East; and Bollywood Parks, an entertainment destination that will showcase the authentic Bollywood movie experience.

Parques Reunidos Servicios Centrales, the second largest operator of leisure parks in Europe, will operate motiongate and Bollywood Parks.

Merlin Entertainments Group Luxembourg, the world's second largest visitor attraction operator, will operate Legoland Dubai.

Hotel Lapita will be managed by Luxury Hotels International Lodging, a Marriott Corporation company.

The Project was initiated by Dubai Parks and Resorts’ founding shareholder, Meraas Holding, and its subsidiaries.

Meraas’ previous funding of development costs, land contribution and initial capital injection prior to IPO, together with the net proceeds from the offering, will constitute the equity component required to finance the project.

In addition, Dubai Parks and Resorts has secured debt financing to ensure that the project, including the equity component, will be fully funded. In addition, Meraas has agreed to fund any potential cost overruns via interest free shareholder loans.

In respect of the offering, Emirates Financial Services, Goldman Sachs International and HSBC Bank Middle East Limited are acting as joint global coordinators and joint bookrunners.

EFG Hermes UAE Limited is acting as Joint Bookrunner. SHUAA Capital is acting as co-Manager (together with the joint bookrunners).

Meraas will be restricted from selling any of its shares until the publication of the company’s audited financial statements for the second year following listing.

Commenting on the IPO, Raed Al Nuaimi, Chief Executive Officer of Dubai Parks and Resorts, said: “With Dubai’s status as a leading global tourist destination continuing to grow, there exists an exciting opportunity to enhance the emirate’s leisure, entertainment and retail offering with the construction of Dubai Parks and Resorts.

“The project will benefit from a prime and easily accessible location, partnerships with world-renowned brands, industry leading operators, and a wide range of attractions catering to visitors of all ages, both from the Middle East and beyond. With the early stages of development already underway, we are aiming to provide investors with access to a high growth, high return, family entertainment business which will become one of the cornerstones of the Dubai entertainment landscape.”

 Abdulla Al Habbai, Chairman of Meraas Holding, said: “The listing of Dubai Parks and Resorts on DFM will mark an important milestone in the development of the project and brings us one step closer to our vision of becoming a premier year-round global entertainment destination. Against a background of strong macroeconomic fundamentals and favourable demographic trends, we see Dubai Parks and Resorts as well positioned to meet increasing visitor demand, both locally and regionally, and should be able to capitalise on the projected growth in tourists to Dubai and the Middle East.” 

Follow Emirates 24|7 on Google News.