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Abu Dhabi Ports begins trading after raising $1.1bn in latest UAE IPO


A woman Emirati paddles her canoe through Abu Dhabi’s skyscrapers on Wednesday, October 2, 2019,

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On Tuesday, Abu Dhabi Ports Group shares opened for trading at 3.6 dirhams ($0.98) per unit. It had raised 4 billion dirhams ($1.1 million) through a share sale. This was the first of a number highly anticipated listings in the United Arab Emirates in this year’s calendar.

Abu Dhabi Ports is now listed on the Abu Dhabi Securities Exchange as ADPORTS. It operates 10 ports within the UAE and a terminal at Guinea. There are also several logistic and industrial areas. The flagship Khalifa Port, Abu Dhabi’s container port, was the region’s first semi-automated and deep water container port. 

According to the company, “The proceeds of the primary issuance will fund the company’s organic and non-organic growth plans and allow it to accelerate its global expansion.” investor filing.

ADQ is the third-largest sovereign wealth fund in UAE. Abu Dhabi Ports are owned by ADQ. ADQ will retain 75.44% of the company’s majority stake. Filings show that ADQ had also transferred 22.32% in Aramex as well as a 10% share in National Marine Dredging Company (AMDC) to Abu Dhabi Ports.

Reuters reported also that Abu Dhabi’s conglomerate IHC bought a 7.4 per cent stake in Abu Dhabi Ports before the listing via its subsidiary Al Seer Marine. This purchase equated to 375 million shares, or $326.74 million. 

Listing spree

This listing is part of a larger privatization drive in the United Arab Emirates.

ADX experienced a significant increase in listings during the past year. The Abu Dhabi National Oil Company, Mubadala state investor, and IHC have all undertaken a series of public offerings. These efforts helped make ADX one of the top performing regional markets.

ADNOC Drilling, which was the largest ever IPO of an emirate company, raised $1.1 million for its October 2013 IPO. The IPO by Tadawul Group, a bourse operator, has seen record interest. more than $1 billion dollars. This follows the ACWA Power International float, worth $1.2 billion. It was the largest IPO in the Kingdom since 2000. Aramco in 2019.

This is in stark contrast to Dubai where capital markets are trailing peers in Abu Dhabi and Riyadh despite increased investor interest across the region. Poor liquidity and a number of high profile de-listings — such as port operator DP World, Emaar Malls and Damac Properties — have dented investor sentiment in recent years. 

Dubai declared plans in November to reverse the trend and increase the stock markets’ total volume to AED3 trillion (or $817 billion). Without naming any specific companies or setting a date, the government stated that it would privatize 10 state-owned businesses.

Rumours suggest that TECOM is a business park operator, Dubai Electricity and Water Authority, (DEWA), and Salik, a road toll system, has been included in the public offering. Businesses within Emirates Group including dnata and Skywards loyalty program, and Dubai airport’s Duty free have also been rumored. 

Dubai’s DFM Index, which tracks the performance of Dubai’s major financial institutions, has seen a 11% increase in its benchmark index since it was announced.