DIFC bids for billion-dollar listings

The Dubai International Finance Centre (DIFC) is looking to collect billion-dollar stock listings from companies in the Middle East by the end of 2006. Officials at the one-year-old securities exchange said they were seeking the amounted capital created by soaring oil prices.

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By  Tamara Walid Published  September 24, 2006

The Dubai International Finance Centre (DIFC) is looking to collect billion-dollar stock listings from companies in the Middle East by the end of 2006. Officials at the one-year-old securities exchange said they were seeking the amounted capital created by soaring oil prices. The tax-free trade zone aims to become a regional trading hub and securities exchange by linking Middle Eastern firms and capital with worldwide investors and financial bodies. Officials at the exchange revealed they were expecting major IPOs by the end of the year, declining to mention specific deals, but stating that they amounted to multi-billions. At the present, a total of five companies have listed shares, depositary receipts or depositary shares on Dubai International Financial Exchange (DIFX) with a sum of US$2.35bn of equity and equity-related market capitalisation. Besides allowing companies to have full foreign ownership the DIFC, Mark Bennewith, media relations manager at DIFC told Arabian Business, “offers firms a zero tax rate and a location with modern infrastructure and world-class regulation from which to operate throughout the MENA region and grow their businesses.” An estimate of 20 Pakistani companies may possibly sell shares in Dubai or Abu Dhabi in the near future as both markets were looking to pen cross-listing policies with the Central Depository Co, owned by Pakistan’s three exchanges, last week. Among the big players in Pakistan and possible companies to be listed on the UAE stock exchanges are the Pakistan Telecommunication Co, Pakistan State Oil and United Bank. On the other hand Gulf investors, keeping afloat by high oil prices, are likely to invest over US$360bn outside the region throughout 2005 and 2006, as the Institute of International Finance stated. An approximate figure of US$1.8 trillion of the region’s wealth is invested overseas. International investment banks such as Deutsche Bank, Goldman Sachs and UBS have established operations in the DIFC. “These firms bring private and public sector clients in the region a wealth of expertise and experience from the world’s largest financial centres. This includes product innovation, access to foreign capital, distribution of credit into deep and liquid markets, access to large balance sheets, and expert financial advice,” said Bennewith.

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