CAPM Says Plans First IPO On Main Dubai Exchange In 5 Years

CAPM Investment, an investment banking and asset management firm in the United Emirates, said it planned to arrange for a company to conduct the first initial public offer of shares on Dubai’s main stock market in five years.

The company, named Marka, is still in the process of being formed. It will operate in the UAE’s fashion retailing and food and beverage sectors; its over 100 founders include prominent local businessmen and investors, CAPM said in a statement on Saturday.

Fifty-five percent of the company’s equity, or 275 million shares, will be offered to the public in the IPO at Dhs1 per share on the Dubai Financial Market, CAPM said. That suggests the IPO would raise $75 million.

Meanwhile, the founders would subscribe to 45 per cent of the equity or 225 million shares. CAPM expects to secure final regulatory approvals to launch the IPO in coming weeks, CAPM’s chief executive Mahdi Mattar said in the statement.

If the IPO goes ahead, it will be a step in the recovery of Dubai’s financial markets from the global financial crisis. There have been no IPOs on the DFM since construction firm Drake & Scull listed in early 2009.

Bank of London and The Middle East, Britain’s largest stand-alone Islamic bank, listed on Nasdaq Dubai last October after conducting the first IPO on the smaller of the emirate’s two stock markets in more than four years.

CAPM, which became a unit of Abu Dhabi-listed Finance House last November, did not give details of Marka’s finances or activities, or say how certain it was that the IPO would go ahead in the next few weeks.

The DFM’s listing rules, published on its website, require documents to be submitted to regulators including “the company’s annual report for the two financial years prior to the submitting of the listing application”. As Marka is only now being formed, it is not clear how it can meet this requirement.

A source familiar with the matter, who declined to be named, said Marka would “invest in mid- to high-end fashion outlets and restaurants”, mainly in the UAE but also in other wealthy Gulf Arab countries.

The IPO is expected to start in late March or early April, the source said.

Other sources said founders of the company included Dubai-headquartered Evolvence Capital and Dubai Investments .