Dubai to Revive Market with IPOs from Private Sector Firms

Dubai is pushing plans to boost economic growth and encourage private firms to get listed on the Stock Exchange amid the Middle East IPO rush. On Saturday, the economic and tourism departments merged to focus on bringing family-owned and private businesses to begin selling shares on the Dubai bourse.

In recent days, the city has taken major steps to boost attractiveness in listing and gain a competitive edge in the stock market against rivals. Leading private businesses include Majid Al Futtaim Holding and Carrefour.

In a new move, Dubai’s financial market head reshuffled the board of the stock exchange to boost listings and attract more companies. Five of the seven board members were replaced after DEWA was listed on the exchange to become the biggest share sale in upcoming months. Such moves will help boost the stock market in the near future. Dubai’s benchmark index rose as much as 1% on Thursday, making it the best performance to be recorded since 2014 with a weekly gain of 9%.

Dubai bourse is now second in position with Abu Dhabi leading in terms of traded volume. Tarek Fadlallah, head of Nomura Asset Management’s Middle East unit said, “The Dubai privatization program can be an important catalyst for the DFM. The execution (book-building, pricing, placement, liquidity) and governance framework will be critical given the poor IPO track record over recent years.”

Leading companies who may consider IPOs include multiple state-owned firms and private organizations including Emirates Airline, Jumeirah Hotels & Resorts, Meraas and Nakheel. In neighboring regions, Saudi Arabia’s stock exchange saw an influx of IPOs which have managed to raise billions in investment.