(MENAFN- Emirates News Agency (WAM))
ABU DHABI, 17th March, 2022 (WAM) -- A UAE newspaper has said that the expected listing of Dubai Electricity and Water Authority (DEWA) on the Dubai financial market (DFM), as part of the emirate's plan to list a number of government-owned entities, will prove to be a turning point in Dubai's capital market.
DEWA said on Tuesday it plans to sell a 6.5 percent stake by offering 3.25 billion shares in its Initial public offering (IPO). According to the company's announcement published in Gulf News, a price range is expected to be announced by 24th March, and shares could list on the DFM by 13th April.
H.H. Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai, Deputy Prime Minister and Minister of Finance, last November revealed a plan to list 10 government and state-owned companies on the DFM as part of accelerating new listings in various sectors including energy, logistics and retail, and to increase the size of the stock market in the emirate to AED3 trillion, raise the competitiveness of bourses and encourage IPOs.
'A month later, Sheikh Maktoum announced the listing of Emirates Central Cooling Systems Corporation (Empower), the world's largest District Cooling Services provider, on the Dubai bourse,' said Gulf News' editorial on Thursday.
'Today represents a significant moment in the history of DEWA and is an important step towards achieving our vision for capital markets in Dubai. As a central component of the Dubai economy, DEWA has a critical role to play in supporting the future growth of the Emirate, and its transition to a net-zero economy by 2050,' Sheikh Maktoum on Tuesday commented on DEWA's announcement. Investing in DEWA is 'an investment in Dubai's future,' he noted.
The offering will boost the market cap of the DFM significantly, and it will also encourage other business conglomerates, especially privately-owned family businesses, to list on the market.
DEWA's IPO is widely expected to be the largest of its kind in Dubai and expected to be used to develop the company's growing use of new storage technologies in renewable energy as well as investing in the expansion of its district cooling services in regional markets such as Saudi Arabia and Qatar.
DEWA has 13.4 gigawatts of installed electricity capacity and can produce 490 million imperial gallons of desalinated water daily. According to published figures, it had adjusted earnings of AED12.121 billion ($3.3 billion) last year and plans to pay a minimum dividend of AED6.2 billion ($1.69 billion) over the next five years to the future investors.
Its services will cater to a growing population from the current 3.5 million to 5.8 million by 2040, DEWA Chief Executive Saeed Mohammad Al Tayer said in a statement.
'The IPO is expected to get an overwhelming response from institutional and retail investors. And will prove a successful template for other entities. It is undoubtedly a bold move that will surely ensure Dubai's sustainable growth,' concluded the Dubai-based daily.
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