Depa Ltd, a Dubai-based interiors contractor working on the world's tallest building, said it is aiming for a $400 million IPO next month to finance expansion and acquisitions, and will list in Dubai and London.
The flotation will be the third primary listing on the Dubai International Financial Exchange (DIFX), which the emirate set up in 2005 to encourage local companies to sell shares to the public, and for foreign companies to tap growing regional wealth.
Depa, which won a $163 million contract in 2005 to fit out apartments in Emaar Properties' Burj Dubai, will also list global depositary receipts in London, Chief Executive Officer Mohannad Sweid told Reuters on Wednesday, ahead of a meeting with reporters to announce the initial public offering.
The number of shares on offer, representing a 40 per cent stake, will be determined after the pricing, decided on a book-building basis, Sweid said. The IPO would value the company at $1 billion.
"A big part of this money will go towards financing acquisitions in the next two years," Sweid said. The company is looking at acquisitions in North Africa, the Middle East and South Asia, Sweid said declining to be more specific.
Like many real-estate-related companies in the Gulf, Depa is benefiting from a construction boom in the world's biggest oil-exporting region, fuelled by a five-fold increase in oil prices during the last six years.
Among other projects, Depa fitted out Dubai's Burj al-Arab, a hotel built on a man-made island just off Dubai's coast, that is in the shape of a sail.
Depa's net profit last year surged 72 per cent to 160.5 million dirhams ($43.71 million), it said in a statement earlier on Wednesday. It did not give more financial details.
Abu Dhabi-based The National Investor (TNI), a finance company that owns 20 per cent of Depa, told Reuters in September that the interiors contractor was planning a $400 million IPO.
Morgan Stanley & Co, UBS AG, TNI and Kuwait's Global Investment House are advising Depa on the IPO. Global also has a stake in Depa.
The IPO, which would be open only to UAE-resident retail investors, and regional and international institutions, will start in the first half of April and the close before the end of the month.
"We want to be an international company and not only regional, and that's why we wanted to list on the DIFX," Sweid told reporters.
"We currently operate in 15 countries through 22 subsidiaries... and in 2008, we plan to add 2 to 3 more countries."
The Financial Times reported on Tuesday that Dubai-based Future Pipe Industries is also planning an IPO and a DIFX listing within weeks to expand its operations. It did not cite any sources.
Kingdom Hotel Investments and Dubai container-port operator, DP World, were the first two companies to list ordinary shares primarily on the DIFX.
In October, DP World raised almost $5 billion in the Middle East's biggest IPO. The shares have since plunged 35 percent. (Reuters)
Depa plans listing in Dubai and London after $400m IPO