DUBAI — In a firm endorsement of robust investor response to its IPO, Deyaar, the region’s fastest growing real estate company, yesterday announced that its AED3.178 billion issue was more than 14 times oversubscribed.
The issue, which successfully closed on May 16, attracted over 85,000 subscribers, collecting over AED45 billion. SHUAA Capital is the lead manager, financial advisor and sole bookrunner for Deyaar’s IPO.
The preliminary subscription data, subject to final audited figures, indicated that the issue is more than 14 times oversubscribed, with noticeable strong retail and institutional demand both in the UAE and across the GCC.
The Ministry of Finance and Industry has elected to subscribe to 5 percent of the total number of shares on offer, the maximum percentage permitted under the law. The ministry will be allocated the full percentage prior to the allocation of shares among the remaining subscribers.
Terming the issue as a major success, Zack Shahin, chief executive officer, Deyaar, said “the demand for Deyaar’s shares reflects the potential of the real estate sector and the investors’ immense confidence in the company’s ability to deliver exceptional value. Deyaar is committed to the growth of the real estate sector, as also maximizing gains to its stakeholders, partners and clients. We are extremely delighted with the huge investor turn out for our offering, which has surpassed all market expectations. Deyaar will continue to build on the valuable trust that our investors have placed in us. “
Rody Yared, head of Syndicate at SHUAA Capital, said “we are very pleased with the figures we are receiving. The strong demand for the issue, from both retail and institutional investors seems to indicate a reversal in market sentiment. In addition, the strong fundamentals of Deyaar, and the knowledge of and trust in the real estate sector evident among subscribers, helped increase the demand for the IPO among all investor segments.”
Refunds and allocations to subscribers in the UAE will commence on May 30, and June 4 for investors who subscribed in the GCC.
Proceeds from the IPO will be used by Deyaar to fund the company’s mega projects in the UAE as well as its ambitious expansion in key strategic markets of Saudi Arabia, Qatar, Kazakhstan and India.
Deyaar has grown phenomenally, with net profits rising from AED5 million in 2003 to AED73 million in 2004, AED141 million in 2005 and AED412 million in 2006. A wholly-owned subsidiary of Dubai Islamic Bank, Deyaar is one of the region’s leading real estate players.