Dubai Exchange Seeks to Woo Private Sector IPOs With Fee Waivers
Dubai’s stock market rolled out an incentive program to attract share sales from the private sector as the business hub seeks to catch up with Abu Dhabi and Riyadh in the Middle East IPO rush.
The incentives include financial support during initial public offerings and post-listing, according to a statement. There will also be a three-year waiver on listing, AGM and dividend distribution fees.
The exchange earlier this month set up a 2 billion-dirham ($545 million) market-maker fund and 1 billion-dirham IPOs support fund to encourage tech companies to list.
Once the United Arab Emirates’ leading exchange by traded volume, Dubai’s market is now second to Abu Dhabi, which has had three IPOs this year. In contrast, Dubai has seen one listing since 2017, and a string of delistings that had dented investor confidence.
Sheikh Maktoum bin Mohammed bin Rashid, deputy ruler of Dubai and the new head of Dubai’s financial market, this month overhauled the exchange’s board, bringing in experts. He also promoted Hamed Ali as the chief executive officer.
The plans to grab a slice of the IPO action include listing as many as 10 state-owned firms, such as utility DEWA -- likely to be the city’s biggest deal -- and its Salik road toll collection system. Private and family-owned businesses are also being encouraged to sell shares on the local bourse.
A flurry of announcements since the start of the month have helped push Dubai Financial Market’s market value to about 24 billion dirhams. Including Tuesday’s 15% gain, the shares have rallied about 190% since Nov. 1. The city’s benchmark index is up 15% in the same period.
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