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DP World plans dual listing on LSE in Q2

The Jebel Ali Port. DP World's stock price has appreciated more than 15 per cent since January 6 last year. (AP)

By Mohamad Al Kady and Sunil Kumar Singh

Dubai-based global marine terminal operator DP World has decided to seek dual listing on the London Stock Exchange (LSE) in the second quarter this year to generate a more realistic valuation of its business, a DP World spokesperson told Emirates Business.

"In March last year, the DP World Board said it would be exploring options to improve the market valuation of the company. They spoke to advisors and a number of shareholders and they supported the idea of a dual listing on LSE and on Nasdaq Dubai to provide more access for investors and more chance to invest in the company. The intention is to generate a more realistic valuation of our business," the spokesperson said.

DP World said in March that it would evaluate options to address 'continued disappointment' with its valuation on the Dubai market.
Trade volumes on DP World stock on Nasdaq Dubai jumped sharply by 571 per cent yesterday after the company announced plans for the dual listing.

The stock witnessed significant interest as 7.93 million shares changed hands yesterday compared with 1.39 million on Tuesday. DP World stock rallied by more than six per cent to $0.450 during intraday trading before it close at $0.449, a 5.90 per cent increase.

Asked at what price it will be launched, the spokesperson said: "It's just the beginning of the process and we need a full set of results. The full 2009 results would come in March 2010. And so we'll begin the process of listing from that point on when we'll have full year results. Any listing on LSE would of course have to be at the same price listed in Dubai."

"DP World's board has decided to seek a premium listing on the LSE whilst maintaining the existing primary listing on Nasdaq Dubai. The board remains committed to our shareholders in the region and believes they will benefit from this move," a company statement said.

This move came after Dubai Financial Market Company announced a process for the acquisition of Nasdaq Dubai, mainly to attract investors and companies to the markets.

"Nasdaq Dubai is run by institutional investors and retail investors represent around 20 per cent only, which is very low compared to the DFM as retail investors represent 70 per cent of transactions," Essa Kazim, DFM's Executive Chairman, had told Emirates Business during the announcement of the acquisition last month.

"We will change the model in Nasdaq Dubai and encourage retail investors to inject more liquidity in the market. Once this happen we expect the turnover in Nasdaq Dubai will jump 10 folds," he said.

Year-on-year, DP World's stock price has appreciated more than 15 per cent since January 6 last year ($.38) till yesterday when the market closed.

LSE is currently witnessing a wave of bull runs and last year was a record year for equity fundraising on LSE.

Throughout the year, many global companies approached the LSE for raising capital. A record £82.5 billion (Dh483bn) was raised through new and further issues of equity on the LSE during the course of 2009, an increase of 16 per cent on the total for 2008, itself a record year, according to LSE.

There were a total of 69 new issues on the exchange, including 18 IPOs, and a significant number of further issues, totalling £80.7 billion ($129 billion), taking place, despite difficult market conditions globally.


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