Dubai Taxi IPO: 25% stake to list on Dubai Financial Market

Dubai Taxi Company announced its intention – on November 13 – to proceed with an initial public offering (IPO) and list its ordinary shares to trade on the Dubai Financial Market (DFM).

On Sunday, Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE issued Law No (21) of 2023 on Sunday, recognising it as a public joint-stock company.

Read Dubai Taxi Company: Sheikh Mohammed issues law; IPO on the cards

Abdul Muhsen Ibrahim Kalbat, chairman of the board of Directors, Dubai Taxi Company said: “Benefitting from Dubai’s exceptional infrastructure and an ambition to double the size of its economy by 2033, supported by the Dubai Urban Master Plan 2040 which maps out a comprehensive plan for sustainable urban development in the emirate, Dubai Taxi Company remains key to the growth, mobility, and sustainability vision of Dubai, playing an integral role in moving and connecting the millions who call Dubai home and the rapidly increasing number of tourists who visit the UAE every year.

“Through this offering, Dubai Taxi Company is proud to support the continuation of the privatisation programme pursued by Dubai, providing a further opportunity for foreign investment and fostering a culture of world-leading innovation and industry.”

Based on a statement by the company, 624,750,000 shares each with a nominal value of Dhs0.04 will be made available in the offering, representing 24.99 per cent of its total issued share capital.

The Department of Finance (on behalf of the Dubai government) is the selling shareholder.

The listing will be available to UAE retail investors and other investors,  professional investors outside the US, including the UAE.

The subscription period will open on Tuesday, November 21, ending on November 28 for UAE Retail Investors and on November 29 for professional investors.

The final offer price will be determined through the application of a book-building process.

The Department of Finance has the right to amend the size of the offering and tranche size before the subscription period concludes, subject to the approval of the Securities and Commodities Authority.

The offering is compliant with Shariah principles.

Details on planned dividends

Post the IPO, the company intends to pay dividends twice each year in April and October in the fiscal year 2024.

Dubai Taxi Company expects to distribute a first dividend of at least Dhs71m to be paid in April 2024.

For the fiscal year 2024 and the years thereafter, an earnings-linked framework with a minimum of 85 per cent of annual net profit will be made available for distribution for the relevant period, the company said in a statement.

The IPO will see 5 per cent each reserved for Emirates Investment Authority and the Pensions and Social Security Fund of Local Military Personnel (as part of the Qualified Investor Offering).

The completion of the offering and admission is scheduled to take place in December.

#Dubai Taxi Company PJSC (“DTC” or the “Company”), a leading provider of comprehensive mobility solutions in #Dubai, today announces its intention to proceed with an initial public offering (the “IPO” or the “Offering”) and to list its ordinary shares (the “Shares”) to trading on… pic.twitter.com/beHmrMpO7N

— Dubai Media Office (@DXBMediaOffice) November 13, 2023

Partners supporting the IPO

Rothschild & Co Middle East has been appointed as the independent financial advisor. Citigroup Global Markets, Emirates NBD Capital, and Merrill Lynch International have been appointed as joint global coordinators and joint bookrunners.

EFG-Hermes UAE Limited (acting in conjunction with EFG Hermes UAE ) and First Abu Dhabi Bank are joint bookrunners for the listing.

Emirates NBD Bank has been appointed as the lead receiving Bank. Abu Dhabi Islamic Bank, Ajman Bank, Commercial Bank of Dubai, Dubai Islamic Bank, Emirates Islamic Bank, First Abu Dhabi Bank and Mashreq Bank have also been appointed as receiving banks.