The Dubai Mercantile Exchange (DME) yesterday said it has concluded the sale of up to 20 per cent of its equity stakes to a number of leading global financial institutions and energy trading firms.
"The contracts that we are looking to bring to the markets in the near future will be designed to address the risk management needs of the regional and international business communities," said Ahmad Sharaf, Chairman of DME.
The new shareholding structure will include Goldman Sachs, Morgan Stanley, Vitol, Concord Energy, Casa Energy Trading, and a Shell company. The exchange was unwilling to name the Shell company.
"All we can say is that it is a member of the Shell Group," said Tom Leaver, the incoming CEO and current COO at DME to a question by Emirates Business.
With this move, New York Mercantile Exchange, Tatweer, and the Oman Investment Fund – the founder investors of DME – will hold a 25 per cent stake each with the new investors holding 20 per cent, while floor members will continue to hold their previous five per cent.
Prior to the sale, Tatweer and NYMEX held a 32.5 per cent stake, while Oman held 30 per cent through the Oman Investment Fund. "We are committed to growing volumes and growing the number of traders who access the DME and trade of contracts," added Leaver.
"With this sale, we get the benefits of experienced commodity traders in terms of developing new contracts," he said.
The sale followed approval from the DME's Board of Directors and the terms of the equity participation between the parties remain private and confidential. Vinson and Elkins acted as legal advisors to the DME on the deal.
"We are delighted to welcome our new stakeholders into the DME. They rank among the world's most successful and sophisticated financial institutions and energy trading firms and their vote of confidence in the Exchange is indicative of the success the DME has achieved, as well as the strategic positioning of Dubai as a financial hub," added Sharaf.