Dubai Electricity & Water Authority to Sell 6.5% Stake in IPO

(Bloomberg) -- State-owned Dubai Electricity & Water Authority plans to sell a 6.5% stake in what could be the city’s biggest initial public offering.

The offer price range will be announced on March 24 with an expected trading debut on April 13, according to an advertisement published by the utility in Gulf News. The company is offering 3.25 billion shares in the transaction. 

• UAE retail offering subscription period: March 24 to April 2
• Qualified investor offering subscription period: March 24 to April 5
• Dubai’s government retains the right to increase the size of the offering before the end of the subscription period
• The company intends to pay dividends twice each fiscal year, in April and October
• Expects to pay a minimum dividend amount of 6.2 billion dirhams per year over the five years through April 2027
• Citigroup, Emirates NBD Capital, HSBC Bank Middle East, Credit Suisse, EFG-Hermes, First Abu Dhabi Bank and Goldman Sachs are among the banks managing the process

Dubai Electricity & Water Authority is pushing ahead with the listing even though Russia’s invasion of Ukraine has effectively shut the IPO markets. Gulf markets are proving resilient to the volatility as surging local stock markets support deal flow on the back of soaring oil prices.

New listings in Middle East financial hubs such as Abu Dhabi and Riyadh have attracted a flood of cash. Investors placed $126 billion in bids for Arabian Internet & Communications Services’ $966 million IPO in Riyadh last year, while Adnoc Drilling attracted more than $34 billion of orders for its listing in Abu Dhabi.

The utility’s IPO is part of Dubai’s plans to list 10 state-owned companies, revive trading volumes and catch up with exchanges in Abu Dhabi and Riyadh. The emirate, which missed out on last year’s IPO boom in the Middle East and North Africa, has also been encouraging private and family-owned businesses to follow suit. Dubai’s stock market has gained about 5% this year.

Dubai Electricity & Water Authority caters to the city’s 3.4 million residents. The utility has 13.4 gigawatts of power capacity and 490 million imperial gallons of desalinated water each day. 

(Updates with more details)

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