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Dubai’s TECOM Draws Orders Worth $9.6Bln for IPO

A picture shows a view of the Dubai skyline, including Burj Khalifa the world's tallest building, in the United Arab Emirates, on June 20, 2022. (AFP)
A picture shows a view of the Dubai skyline, including Burj Khalifa the world's tallest building, in the United Arab Emirates, on June 20, 2022. (AFP)
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Dubai’s TECOM Draws Orders Worth $9.6Bln for IPO

A picture shows a view of the Dubai skyline, including Burj Khalifa the world's tallest building, in the United Arab Emirates, on June 20, 2022. (AFP)
A picture shows a view of the Dubai skyline, including Burj Khalifa the world's tallest building, in the United Arab Emirates, on June 20, 2022. (AFP)

Dubai business park operator TECOM Group said on Monday it drew orders worth $9.63 billion for its initial public offering, the latest Middle East listing to attract strong investor demand amid a boom in regional share sales.

It had previously announced setting the final offer price for its IPO at AED2.67 ($0.72) per share.

The Global Offering drew substantial demand from both the Qualified Institutional Offer and UAE Retail with total gross demand reaching AED35.4 billion, implying an oversubscription level of over 21 times in aggregate at the final price.

The UAE Retail Offer achieved an oversubscription level of almost 40 times in aggregate, making it the highest oversubscription multiple ever for IPOs on the Dubai Financial Market (DFM).

As a result of the extremely strong demand, the final offer price was set at the top of the price range and the company has raised AED1.7 billion ($462 million) through the IPO.

Malek al-Malek, Chairman of TECOM Group, said: “The tremendous demand we drew both locally and internationally for the TECOM Group IPO, especially amid challenging market conditions, is testament to the company’s appealing value proposition and growth prospects.”

He stressed that the investors’ high turnout is underpinned by their optimism toward Dubai’s economy and confidence in the Emirate’s capital markets.

As previously announced, the Global Offering comprised an offering of 625 million ordinary shares, representing 12.5% of TECOM Group’s issued share capital, all of which is expected to be listed on the DFM on or around July 5.

Upon listing the company, it will have an implied market capitalization of AED13.4 billion ($3.6 billion), and DHAM LLC will continue to own a majority 86.5% stake in the company (or 87.5% together with DHAM FZ-LLC).

TECOM houses more than 7,500 companies and 10 large business complexes including Dubai Internet City and Dubai Media City.

Dubai's deputy ruler, Sheikh Maktoum bin Mohammed, in November announced plans to take 10 government-linked companies public to boost stock market activity to three trillion dirhams (about $817 million).

Dubai Electricity & Water Authority’s (DEWA) $6.1 billion share sale in April was the first, and a float of the city’s road-toll system, Salik, is set to follow after the summer.

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Oil Rises as Investors Weigh Market Outlook, Tariffs, Sanctions

A view shows oil pump jacks outside Almetyevsk in the Republic of Tatarstan, Russia June 4, 2023. REUTERS/Alexander Manzyuk
A view shows oil pump jacks outside Almetyevsk in the Republic of Tatarstan, Russia June 4, 2023. REUTERS/Alexander Manzyuk
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Oil Rises as Investors Weigh Market Outlook, Tariffs, Sanctions

A view shows oil pump jacks outside Almetyevsk in the Republic of Tatarstan, Russia June 4, 2023. REUTERS/Alexander Manzyuk
A view shows oil pump jacks outside Almetyevsk in the Republic of Tatarstan, Russia June 4, 2023. REUTERS/Alexander Manzyuk

Oil prices rose by around 1% on Friday as investors weighed a tight prompt market against a potential large surplus this year forecast by the IEA, while US tariffs and possible further sanctions on Russia were also in focus.

Brent crude futures were up 76 cents, or 1.11%, at $69.40 a barrel as of 1153 GMT US West Texas Intermediate crude ticked up 82 cents, or 1.23%, to $67.39 a barrel.

At those levels, Brent was headed for a 1.6% gain on the week, while WTI was up around 0.6% from last week's close.

The IEA said on Friday the global oil market may be tighter than it appears, with demand supported by peak summer refinery runs to meet travel and power-generation, Reuters reported.

Front-month September Brent contracts were trading at a $1.11 premium to October futures at 1153 GMT.

"Civilians, be they in the air or on the road, are showing a healthy willingness to travel," PVM analyst John Evans said in a note on Friday.

Prompt tightness notwithstanding, the IEA boosted its forecast for supply growth this year, while trimming its outlook for growth in demand, implying a market in surplus.

"OPEC+ will quickly and significantly turn up the oil tap. There is a threat of significant oversupply. In the short term, however, oil prices remain supported," Commerzbank analysts said in a note.

Further adding support to the short-term outlook, Russian deputy prime minister Alexander Novak said on Friday that Russia will compensate for overproduction against its OPEC+ quota this year in August-September.

"Prices have recouped some of this decline after President Trump said he plans to make a 'major' statement on Russia on Monday. This could leave the market nervous over the potential for further sanctions on Russia," ING analysts wrote in a client note.

Trump has expressed frustration with Russian President Vladimir Putin due to the lack of progress on peace with Ukraine and Russia's intensifying bombardment of Ukrainian cities.

The European Commission is set to propose a floating Russian oil price cap this week as part of a new draft sanctions package, but Russia said it has "good experience" of tackling and minimising such challenges.