Dubai Investments wants to float at least 30 per cent of Emicool on DFM

Dubai Investments, a diversified company in which sovereign wealth fund Investment Corporation of Dubai has an 11.54 per cent stake, plans to float at least 30 per cent of its district cooling unit Emicool by the end of 2018 on the Dubai Financial Market, its chief executive said.

Dubai Investments has hired its unit, financial investment firm Al Mal Capital, to be lead manager of the IPO, the Dubai-listed company said. Prior to the IPO, the company plans to acquire two district cooling companies in the UAE with an estimated combined value of Dh600 million and then bring in investors to take a stake in Emicool, Khalid bin Kalban told The National.

“We have two steps before we undertake the IPO. We have acquisitions we will make in the second quarter,” Mr bin Kalban said yesterday. “We have investors who are interested in buying a stake in the company [Emicool] before the IPO. When we get the new investors we will decide with them the stake to be sold.”

Emicool will be the second district cooling firm to be listed in Dubai after National Central Cooling Company, or Tabreed, in which France’s Engie has a 40 per cent stake. Dubai Investments bought this year an additional 50 per cent stake in Emicool from Dubai-listed real estate developer Union Properties for Dh500 million, giving it full ownership of the utilities company.

Public offerings are making a comeback following a dry spell over the past couple of years when a slowdown in economic growth forced many companies to shelve plans for IPOs amid concerns of not getting proper valuations for their businesses.

The Middle East and North Africa region recorded five IPOs in the third quarter of this year alone, up from a single listing in the same period last year, and more offerings are expected thanks to the recovery in oil prices, consultancy EY said in a report released in December.

The value of IPOs in the third quarter rose 20 per cent to US$236.7m from a year-earlier period, led by three deals on Tadawul, according to EY.