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Sat, Nov 23, 2024 | Jumada al-Awwal 21, 1446 | DXB
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Dubai’s IPO accelerator initiative to give major fillip to capital markets
Scheme aims to support businesses in the region on their path to growth and share sales
In 2022, DFM became one of the most active markets globally for IPOs. - KT file
The launch of an IPO accelerator programme on Thursday by The Dubai Financial Market and Dubai Chamber of Commerce is expected to give an enormous fillip to Dubai’s capital markets by supporting businesses in the region on their path to growth and an initial public offering, market analysts said.
The programme, part of the Dubai Economic Agenda D33 projects that aim to strengthen Dubai’s leading position as a global commercial and financial hub, responds to the growing interest from the private sector in Dubai to leverage capital markets, the DFM and Dubai Chambers said in a statement.
The DFM-Dubai Chambers joint initiative is aimed at family businesses, large private companies, and businesses from sectors that can benefit from Dubai’s capital markets, creating opportunities for growth, it said.
Hamed Ali, CEO of DFM & Nasdaq Dubai, said the Accelerator Programme is aligned with DFM’s efforts to create a conducive environment for companies to go public and raise capital through Dubai’s capital market. “This programme will provide businesses with the necessary education, support, and guidance to explore their IPO opportunity and contribute to the growth of Dubai’s economy,” said Ali.
Mohammad Ali Rashed Lootah, president & CEO of Dubai Chambers, said: “We are delighted to partner with DFM to create an environment where various companies that consider public listing or going public through IPOs can find the capital they need to grow while building visibility and credibility with investors. More importantly, this programme aligns with Dubai’s economic ambitions to double the size of the economy by 2033 and consolidate its position among the top three global cities.”
Mohammad Ali Rashed Lootah, President & CEO of Dubai Chambers (left) and Hamed Ali, CEO of DFM & Nasdaq Dubai. - Supplied photo
Saad Manair, senior partner at Crowe UAE, said the IPO accelerator programme aims to support and facilitate the listing of new companies on the DFM, thereby boosting economic growth and diversification in the UAE. “The programme could provide new companies with access to capital through the IPO process, allowing them to raise funds for expansion and growth. Despite the benefits, some companies may be hesitant to participate in the programme due to the rigorous listing requirements and potential costs associated with going public.
“While there are potential benefits and challenges associated with the DFM and Dubai Chamber of Commerce IPO accelerator programme, its success will ultimately depend on market conditions, regulatory requirements, and the level of interest and participation from new companies,” said Manair.
Atik Munshi, managing partner of FinExpertiza UAE, said going public is a tall task and it requires years of preparations. “Not only does the prospective company needs to adhere to the regulatory requirements but they need to hire several professionals entities like legal advisors, accountants, underwriters, investment bankers and more to steer them through the process.”
He said many large private companies have a vision to go for an IPO but lack the full knowledge and backing to make it a success. “A little hand holding in this area can go a long way. This initiative by DFM and DC would really help such prospective companies. As the Middle East and UAE is expecting a big thrust in the public listing of family owned and private companies, this can be considered a desirable move from the authorities. Dubai’s D3 will realise many more dreams,” said Munshi.
DFM and Dubai Chamber of Commerce, one of the three chambers operating under Dubai Chambers, are partnering with numerous local and international advisory firms that are a key part of Dubai’s financial and business ecosystem to accelerate the growth of regional private companies and nurture them for the IPO journey.
In 2022, DFM became one of the most active markets globally for IPOs and listings attracting five leading government-related and private companies that successfully raised Dh31 billion.
As part of the programme, DFM and Dubai Chamber, along with advisory firms will conduct workshops to prepare businesses and offer one-on-one meetings with key prospects to create a customized route towards an IPO as well as to identify and resolve any challenges, with a focus to making Dubai an even more desirable destination for businesses to grow from. The first workshop is due to take place in May 2023 with the participation of 40 private companies from various sectors, said the statement.
The programme’s partners include Al Tamimi & Co, Arqaam Capital, Bank of America, Barclays, Citi, deNovo Partners, Edelman Smithfield, EFG Hermes, Emirates NBD, EY, Goldman Sachs, Grant Thornton, HSBC Bank Middle East Limited, Ibrahim .N. Partners, J.P. Morgan, Moelis & Company, Morgan Stanley, PwC Middle East, Rothschild & Co, and White & Case LLP.
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