DP World Ltd, the Dubai-owned port operator with terminals from the UK to China, raised US$4.96 billion in the Middle East's biggest initial public offering.
The world's fourth-largest ports company sold shares for US$1.30 each, the top of an indicated range, after the IPO was more than 15 times oversubscribed, it said in a statement yesterday. That gives a market value of US$21.6 billion.
Dubai's biggest step to date in establishing itself as a global financial center surpasses Saudi Telecom Co's US$4.1 billion IPO in 2003 and will spur interest in the sheikdom's two-year-old stock exchange as the government turns to asset sales to lure investors. Dubai has also bought stakes in Nasdaq Stock Market Inc and London Stock Exchange Group Ltd as it vies with Qatar and Bahrain to be the region's dominant player, Bloomberg News said.
"We are delighted with the response," DP World Chairman Sultan Ahmed Bin Sulayem said in the statement. "The fact the IPO has been so heavily oversubscribed reflects the market's confidence. DP World will have a solid base of international investors."
DP World boosted the size of the sale to 23 percent of its equity from 20 percent to meet demand. The money raised will help repay US$3.5 billion of Islamic bonds and provide cash to the Dubai government. Prior to the IPO the firm had indicated it would sell the shares for US$1 to US$1.30 apiece.
DP World bought Peninsular & Oriental Steam Navigation Co last year for US$6.8 billion. It now has 42 terminals in 22 countries and a pipeline of new projects that will almost double capacity in 10 years as it seeks to catch up with Hong Kong's Hutchison Port Holdings Ltd and Singapore's PSA International Pte.
"DP World is among the few global infrastructure plays and that is a hot theme in the market," said Nazem Fawwaz al-Kudsi, chief investment officer at National Bank of Abu Dhabi PJSC.