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There are currently eight Salik toll gates in Dubai.

PHOTO BY ARCHIVE


Salik IPO, Dubai Financial Market listing: All you need to know

Salik, Dubai’s exclusive toll gate operator, announced on Monday (September 5) it will proceed with an initial public offering (IPO) and list its shares for trading on the Dubai Financial Market.

According to Salik, one billion five hundred million (1,500,000,000) shares, each with a nominal value of Dh0.01, will be made available in the IPO, representing 20 percentof Salik’s total issued share capital.

It added that the offering comprises Individual Subscribers (first tranche); Professional Investors (second tranche), and Eligible Employees (third tranche). The subscription period will open on September 13 and is expected to close on September 20 for UAE Retail Investors and on September 21 for Qualified Investors.

The Government of Dubai, represented by the Department of Finance, reserves the right to amend the size of the IPO at any time prior to the end of the subscription period at its sole discretion, subject to applicable laws and the approval of the Securities & Commodities Authority.

The Internal Sharia Supervision Committee of Emirates NBD Bank has issued a Shariah pronouncement confirming that the IPO is compliant with Shariah principles.

Admission is expected in September 2022. The share capital of Salik at the date of the listing, was set at Dh75 million divided into 7,500,000,000 shares paid-in-full, with the value of each share being Dh0.01.

Following the IPO, Salik intends to pay dividends twice, in April and October of each fiscal year. Salik expects to pay a first dividend for the second half of 2022 by April 2023, and it expects to pay 100 percent of the net profit, after keeping aside the statutory reserves required by law (statutory reserves expected to amount to Dh37.5 million for the first dividend).

From 2023 onwards, Salik expects to pay 100 percent of the net profit available for distribution as dividend. This dividend policy is subject to consideration by the Board of Directors of the cash management requirements of the Company’s business for operating expenses, interest expenses and anticipated capital expenditures and investments.

In addition, Salik expects that the Board will also consider market conditions, the then current operating environment in the Company’s markets, and the Board’s outlook for the Company’s business and growth opportunities.

Mattar Al Tayer, Chairman of Salik’s Board of Directors, pointed out that the IPO comes after Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, issued a law in June establishing Salik as a public joint stock company to operate the road toll system.

“Today’s announcement is a continuation of the privatization programme pursued by the emirate of Dubai and of its plans to double the size of its financial market to three trillion dirhams and attract foreign investments,” Al Tayer said. There are currently eight Salik toll gates in Dubai.

The Government of Dubai, represented by the Department of Finance, expects to sell 20 percent of the total issued share capital of Salik (equivalent to a total of 1,500,000,000 number of shares), with the Selling Shareholder retaining the right to amend the size of the IPO at any time prior to the end of the subscription period at its sole discretion, subject to applicable laws and the approval of the SCA.

Further, as part of the Qualified Investor Offering, and in accordance with both the Companies Law and the Dubai Law, the following will apply: five percent of the Offering will be reserved for offer to the Emirates Investment Authority, and; five percent of the Offering will be reserved for offer to the Pensions and Social Security Fund of Local Military Personnel.

The UAE Retail Offering subscription period is expected to run from September 13 to 20, with the Qualified Investor Offering subscription period expected to run from September 13 to 21. The offer price per share will be determined through, and following, a book building process. Investors participating in the UAE Retail Offering will subscribe for the shares at the offer price.

The completion of the Offering and Admission is currently expected to take place in September 2022, subject to market conditions and obtaining relevant regulatory approvals in the UAE, including approval of Admission to Listing and trading on the DFM.

Moelis & Company UK LLP DIFC Branch has been appointed as the Independent Financial Advisor and Emirates NBD Capital PSC has been appointed as Financial Advisor to Salik.

Emirates NBD Capital, Goldman Sachs International, and Merrill Lynch International have been appointed as Joint Global Coordinators and Joint Bookrunners.

Citigroup Global Markets Limited, EFG Hermes UAE Limited (acting jointly with EFG Hermes UAE LLC), and HSBC Bank Middle East Limited have been appointed as Joint Bookrunners.

Emirates NBD Bank PJSC has been appointed as the Lead Receiving Bank. Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Ajman Bank, Commercial Bank of Dubai, Dubai Islamic Bank, Emirates Islamic Bank, First Abu Dhabi Bank, Mashreq Bank, MBank and Sharjah Islamic Bank have also been appointed as Receiving Banks. ICA/Expat Media


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