Dubai Taxi Company (DTC) received over 150 billion dirhams ($41 billion) in investor orders for its $315 million initial public offering, a record for the city, reported Bloomberg on Wednesday.
The IPO was 130 times covered, according to a statement. The company said it was the highest oversubscription level ever for a Dubai IPO. The institutional investor tranche was almost 135 times oversubscribed.
Dubai Taxi sets IPO price range, valuing company at up to $1.25bn
The emirate’s government sold 624.75 million shares, or a 25% stake, at 1.85 dirhams each, which is at the top of a marketed range, it said. The pricing values Dubai Taxi at 4.62 billion dirhams, and shares will start trading on December 7.
Mansoor R. Alfalasi, chief executive officer at DTC, said the exceptionally strong demand for the IPO reflects the high-quality investment opportunity, anchored in Dubai’s robust economic, population and tourism growth and world-leading mobility and sustainability vision.
“With DTC’s own growth accelerating, enabled by the continued expansion of our market-leading fleet, ongoing investment in the latest technologies and our expansion across Dubai and into neighbouring emirates, this is an exciting time for DTC and our new investors,” he was quoted as saying by Khaleej Times on Wednesday.
“We are also proud to support Dubai’s privatisation programme, with overwhelming investor interest and our significant oversubscription levels reflecting strong confidence in Dubai and supporting the further expansion of the Dubai Financial Market.”
The company had appointed Citigroup Global Markets Limited, Emirates NBD Capital, and Merrill Lynch International as joint global coordinators and bookrunners, and EFG Hermes UAE and First Abu Dhabi Bank as joint bookrunners on the deal.
Rothschild and Co Middle East is mandated as independent financial adviser.
The overwhelming level of demand for Dubai Taxi’s IPO underscores the chasm between the Gulf’s booming listings market and the gloomy sentiment globally, where share sales have been hobbled for the past two years by high interest rates and market volatility, Bloomberg said in its report.
Dubai is the Gulf’s best performing market this year, with the benchmark index up 20% so far on the back of a jump in property-related shares.
Excluding Dubai Taxi, about $8.4 billion has been raised through IPOs in the region this year, which accounts for over a third of the total listing volumes in all of Europe, the Middle East and Africa, data compiled by Bloomberg show.
Dubai Taxi is the city’s second IPO of 2023. Family-owned money exchange firm Al Ansari Financial Services PJSC raised $210 million in March in what was one of the first private firms to list in the United Arab Emirates.