Dubai jeweller Damas eyes $355 mln in IPO

Family-controlled Damas plans to sell 270.58 million ordinary shares at between $1 and $1.14 per share and list the shares on the Dubai International Financial Exchange (DIFX) next month, it said in a statement on Wednesday.

The offering of mainly new shares would be open to Middle East and global institutional investors outside of the United States, Damas said.

The IPO includes an over-allotment option of 40.59 million shares -- which could bring the total value of the sale to $354.73 million at the top end of the price range, according to Reuters calculations.

"We look to capitalise on opportunities to further expand our operations given the strong regional economic growth in areas such as the Gulf, north Africa and south Asia," Damas Chief Executive Tawhid Abdullah said in the statement.

Damas could spend more than $750 million to double its store network from 438 in the UAE and other countries -- including Egypt, Turkey, India and China -- in the next three years, Abdullah was quoted in Emirates Business as saying in April.

Damas, which operates in 18 countries, would be the fourth primary listing and the first retail company to list on the DIFX, set up in 2005 to operate according to international standards of accounting and financial reporting.

Kingdom Hotel Investments, DP World and Depa Ltd and 11 other firms also trade shares on the DIFX, which is 33 percent owned by exchange group Nasdaq OMX Group.

Right step

"This is a step in the right direction," Eric Swats, head of asset management at Rasmala Partners Ltd, said of the Damas listing. "For an exchange to become liquid and interesting it requires multiple listings, which is a process."

Dubai set up the DIFX to encourage local companies to sell shares to the public, and for foreign companies to tap growing regional wealth.

But it got off to a slow start after regional stock markets fell in 2006, prompting Oger Telecom to cancel a plan to raise $1.25 billion through selling shares that it would list on the exchange.

In May this year, Lebanon's Makhzoumi family dropped plans to raise up to $554 million in an IPO of its Dubai-based Future Pipe Industries.

Last year, Dubai-government owned DP World was the first company to list solely on the DIFX after raising almost $5 billion in the Middle East's biggest IPO.

The founding family of Damas will not be selling any shares in the IPO, the company said on Wednesday.

The offering represents 28 percent of the enlarged share capital of the company, including 86.4 percent of new shares and 13.6 percent of secondary shares being sold by Amwal al-Khaleej Commercial Investment Co, it said.