There is a world of difference between announcing that you are considering an initial public offering, and actually getting the shares to the stage of first-day trading.
We've seen it many times in UAE markets. "XYZ plans share listing," scream the headlines, usually based on the anonymous word of two or three bankers "aware of the plan".
Everybody in the financial community gets very excited. The markets, starved of new listings since the financial crisis, are dying to get one to get the IPO ball rolling again.
The financial professionals rub their hands at the thought of those lucrative IPO and underwriting fees; the PRs also get all worked up at the thought of some new business; even the financial journalists raise a glimmer of interest at the prospect of writing about something other than debt and restructuring issues.
But for the past few years, especially in Dubai, that's as far as it has got. Several "planned IPOs" have been pulled at various stages along the process. Axiom in 2010 was probably the most advanced, aborted just a few days before trading was due to begin. Al Habtoor created quite a stir for a while last year before being called off for "moral" reasons.
So while it's encouraging to see that Damac, one of the best known names in Dubai property, is considering a listing, maybe we shouldn't get too excited just yet. Experience shows there are plenty of things that can go wrong on the IPO journey.
Damac Properties was launched in Dubai in 2002 by Hussain Sajwani, the current chairman, and expanded rapidly in the high-end residential and commercial development market. Inevitably, the property crash of 2009 slowed its progress, but it has come back since with a number of eye-catching developments, usually in association with a big-name luxury brand such as Versace, Fendi and (most recently in Dubai) Paramount Hotels. Foreign expansion followed, in Egypt, Saudi Arabia, Lebanon and other places across the region.
Mr Sajwani is described by one confidant as a "real entrepreneur" who sees and exploits market opportunities enthusiastically. Damac's catering business is held as an example: he built a good business from the basic idea of feeding workers in the oil services sector.
So, you might think, all the ingredients are there for a successful IPO, especially against the backdrop of the recovery in the Dubai property market. But it is still very early days. In the words of one senior banker involved in the plans, "it's super-premature".
There is not much in the public domain about the condition of Damac finances, so speculation about values and market capitalisations is even vaguer than usual. Some experts talk about a total market value of $1 billion (Dh3.67bn), but it's really at the stage of informed guesswork.
There are also some legal issues to be resolved. Mr Sajwani found himself at the wrong end of an Egyptian court decision recently that alleged he was tied in with the Mubarak regime.
Talks continue about a resolution of these problems, but it would be good to have them out of the way before the lawyers and bankers got round to drafting an IPO prospectus.
There has been some talk that Damac might go for London as a market that understands property and where potential investors are located; even that Hong Kong, as a market that understands the luxury sector, might be more appropriate.
Of course, if the company got far enough down the IPO road and decided on a Dubai listing, it would still have to make the choice between the Dubai Financial Market and Nasdaq Dubai. Some market executives believe it might be possible to construct some form of dual listing on the two markets, as was considered for Al Habtoor, but this would require the approval of Dubai policymakers.
There is a lot of work still to do before we can get too excited about a Damac IPO.
fkane@thenational.ae
The White Lotus: Season three
Creator: Mike White
Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell
Rating: 4.5/5
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Skewed figures
In the village of Mevagissey in southwest England the housing stock has doubled in the last century while the number of residents is half the historic high. The village's Neighbourhood Development Plan states that 26% of homes are holiday retreats. Prices are high, averaging around £300,000, £50,000 more than the Cornish average of £250,000. The local average wage is £15,458.
Other workplace saving schemes
- The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
- Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
- National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
- In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
- Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
The view from The National
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Glossary of a stock market revolution
Reddit
A discussion website
Redditor
The users of Reddit
Robinhood
A smartphone app for buying and selling shares
Short seller
Selling a stock today in the belief its price will fall in the future
Short squeeze
Traders forced to buy a stock they are shorting
Naked short
An illegal practice
The smuggler
Eldarir had arrived at JFK in January 2020 with three suitcases, containing goods he valued at $300, when he was directed to a search area.
Officers found 41 gold artefacts among the bags, including amulets from a funerary set which prepared the deceased for the afterlife.
Also found was a cartouche of a Ptolemaic king on a relief that was originally part of a royal building or temple.
The largest single group of items found in Eldarir’s cases were 400 shabtis, or figurines.
Khouli conviction
Khouli smuggled items into the US by making false declarations to customs about the country of origin and value of the items.
According to Immigration and Customs Enforcement, he provided “false provenances which stated that [two] Egyptian antiquities were part of a collection assembled by Khouli's father in Israel in the 1960s” when in fact “Khouli acquired the Egyptian antiquities from other dealers”.
He was sentenced to one year of probation, six months of home confinement and 200 hours of community service in 2012 after admitting buying and smuggling Egyptian antiquities, including coffins, funerary boats and limestone figures.
For sale
A number of other items said to come from the collection of Ezeldeen Taha Eldarir are currently or recently for sale.
Their provenance is described in near identical terms as the British Museum shabti: bought from Salahaddin Sirmali, "authenticated and appraised" by Hossen Rashed, then imported to the US in 1948.
- An Egyptian Mummy mask dating from 700BC-30BC, is on offer for £11,807 ($15,275) online by a seller in Mexico
- A coffin lid dating back to 664BC-332BC was offered for sale by a Colorado-based art dealer, with a starting price of $65,000
- A shabti that was on sale through a Chicago-based coin dealer, dating from 1567BC-1085BC, is up for $1,950
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
Zayed Sustainability Prize
Killing of Qassem Suleimani
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The National in Davos
We are bringing you the inside story from the World Economic Forum's Annual Meeting in Davos, a gathering of hundreds of world leaders, top executives and billionaires.
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
The End of Loneliness
Benedict Wells
Translated from the German by Charlotte Collins
Sceptre
Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
Round 3: February 7-9, Dubai Autodrome – Dubai
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
MATCH INFO
New Zealand 176-8 (20 ovs)
England 155 (19.5 ovs)
New Zealand win by 21 runs
Match info:
Real Betis v Sevilla, 10.45pm (UAE)
