Home / Du plans to raise AED1bn in rights issue

Du plans to raise AED1bn in rights issue

Capital raised will fund an accelerated growth strategy, according to Du.

Du plans to raise AED1bn in rights issue
Du intends to invest a further AED2.2 billion in its network in 2010.

Du said on Monday it was planning to raise AED1 billion ($272.2 million) through a rights issue.

The capital raised will fund an accelerated growth strategy, the Dubai telecom operator said.

An extraordinary general meeting will be held on May 11 to approve the increase in the company's share capital and the issue of new shares to shareholders on a pro rata basis, the company added in a statement.

The rights issue subscription period is expected to start on May 27 and end on June 8.

Du said it plans to use the capital to "deliver on its commitment to customers by continuing to enhance network capabilities and expand fixed and mobile infrastructure".

It also said it intends to invest in the next phase of growth "to become the preferred integrated telecommunications provider in the UAE".

The statement said the founding shareholders of Du (Emirates Investment Authority, Mubadala Development Company and Emirates Communications and Technology), holding approximately 80% of the company, fully supported the rights issue.

JP Morgan will act as rights issue co-ordinator and bookrunner and Mashreqbank is acting as lead receiving bank for the rights issue, Du added.

Ahmad Bin Byat, chairman of Du, said: "One of our goals is to transform Du from a high growth early stage venture to a more mature company with efficient management of future funding requirements. The capital raised through this rights issue will provide the necessary first step in taking the company forward to achieve its goals.

Osman Sultan, CEO of Du, added: "This rights issue is an important and strategic move that will contribute significantly to delivering on our accelerated and efficient growth strategy."

He added that the company had invested in excess of AED2.4 billion in its network in 2009, and expected to commit AED2.2 billion more in 2010.

"The AED1 billion we are seeking to raise will allow us to continue to deliver on our promise, ultimately enabling the company to carry on building a successful, sustainable telecommunications business."

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