Emaar Plans to Raise $1.5 Billion From Development Unit IPO

Company offering 800 million shares at 5.7-6.9 dirhams each

02/11/2017 09:33 AST

Emaar Properties PJSC is seeking to raise as much as $1.5 billion from the initial public offering of its United Arab Emirates development business in what would be the country's biggest share sale since 2014.

The developer of the world's tallest skyscraper plans to sell 800 million shares in Emaar Development LLC at a price range of between 5.7 dirhams ($1.55) and 6.9 dirhams per share, the Dubai-based company said in a statement to the bourse on Thursday. The IPO opens today, with about 10 percent of the shares available to retail investors and 90 percent to institutions.

The sale would be the largest since Emaar Malls PJSC's $1.6 billion offering in 2014, according to data compiled by Bloomberg. It's part of Emaar's plan to list subsidiaries to help boost the value of the parent, which spearheaded a building boom in Dubai after foreigners were allowed to own properties in some parts of the emirate. Emaar, Emaar Malls and the company's units in Saudi Arabia and Egypt are already listed.

Emaar is selling 20 percent in the unit. The subsidiary expects to pay at least $1.7 billion in dividends over the next three years. The offering to retail investors closes Nov. 13, and to qualified investors on Nov. 15, with the shares to be listed on the Dubai Financial Market on Nov. 22.

Bank of America Merrill Lynch, EFG Hermes U.A.E. Ltd., Emirates NBD Capital PSC, First Abu Dhabi Bank PJSC and Goldman Sachs Group Inc. are acting as the joint global coordinators for the offering, while Emirates NBD PJSC and FAB will be the lead receiving banks. Rothschild is the financial adviser.

Bloomberg