Shuaa Capital in talks to list shares of subsidiaries

Dubai’s investment bank Shuaa Capital is in talks with different stock exchanges to list the shares of its subsidiaries through initial public offerings.

These talks are at “very early stages” and Shuaa may list “one or more” of its subsidiaries, it said yesterday in a regulatory filing to the Dubai Financial Market, where its shares are traded.

The company did not say which exchanges it was in discussions with or the subsidiaries it intended to list.

Shuaa’s statement came after a Bloomberg report that said the investment bank was in discussion with the DFM to launch IPOs for two of its subsidiaries – Stanford Marine Group and NCM Investment – amid Dubai’s efforts to encourage more public and private sector companies to list their shares on the emirate’s bourse.

Shuaa plans to sell shares in both companies early next year and is engaged in discussion to hire investment banks as bookrunners. Combined, the two assets have a value of about Dh2 billion ($545 million), according to the report.

Dubai, the commercial and tourism centre of the Middle East, is looking to broaden and deepen its stock market.

Earlier this month, the emirate announced plans to list 10 state-owned companies as part of its wider strategy to double the size of the financial market to Dh3 trillion.

The Dubai Electricity and Water Authority will be the first state entity to list on the DFM, it was announced earlier this month.

Dubai authorities also set up a Dh2bn market-maker fund to encourage listings from private and family owned businesses from the energy, logistics and retail sectors.

The government is also encouraging private and family-owned businesses to follow suit. Information technology company StarLink already pledged to go public early next year.

Dubai, which has also formed the Securities and Exchange Higher Committee, is setting up a Dh1bn fund to attract more technology companies to list, Sheikh Maktoum bin Mohammed, Deputy Prime Minister and Minister of Finance, said at the time.

This month, Shuaa, which manages $14bn in assets, reported a 39 per cent increase in its nine-month profit to Dh89m on a boost in recurring income.

Income for the third quarter climbed 19 per cent to Dh35m.

The investment bank did not say which exchanges it was in discussions with or the subsidiaries it intended to list