DP World eyes US$3.5b in share sale

DP World Ltd, the Dubai-owned ports company with terminals from the United Kingdom to China, plans to raise as much as US$3.5 billion in an initial share offering as the emirate turns to asset sales to attract international investors.

DP World will start selling about 20 percent of its equity next month, Chairman Sultan bin Sulayem told reporters in Dubai yesterday. He declined to comment on the price, estimated on October 4 by two people with knowledge of the proposal. The IPO, the biggest in the Middle East to be open to all investors, will help fund expansion and support the emirate's ambition to become a global financial center, Sulayem said.

The sale will achieve "Dubai's objectives of getting investors involved in one of its main drivers of growth, and putting the emirate firmly on the international capital-markets map," said Chavan Bhogaita, head of credit research at HSBC Holdings Plc in Dubai.

The IPO follows Dubai's purchase of stakes in Nasdaq Stock Market Inc and London Stock Exchange Group Ltd as the emirate vies with Qatar and Bahrain to be the region's dominant financial center. A successful DP World sale might be copied by government-controlled companies including Nakheel PJSC, the developer of the world's biggest man-made islands, Bloomberg News said.

DP World's shares will be listed on the Dubai International Financial Exchange, which is to be renamed as a Nasdaq venture following the September deal with the US company. Dubai is using cash from the Gulf's oil-fueled economic boom to establish a financial center that would plug a trading gap between London and Singapore. The emirate already owns stakes in banks including HSBC, Deutsche Bank AG and Standard Chartered Plc.

DP World had 2006 revenue of US$2.1 billion, excluding joint ventures and associates, according to a company statement in Dubai yesterday. Sales for the six months ended on June 30 were US$1.2 billion, it said.