EFG Hermes serves as joint bookrunner on Salik IPO

The issuance offers investors access to a capital efficient, world class toll-gate operator, with a robust track record, in one of the fastest growing cities in the world



EFG Hermes continues to sustain its leading position in the market through its unmatched execution capabilities, as it advises on the region’s largest and most prominent ECM, DCM, and M&A transactions. — File photo
EFG Hermes continues to sustain its leading position in the market through its unmatched execution capabilities, as it advises on the region’s largest and most prominent ECM, DCM, and M&A transactions. — File photo
by

A Staff Reporter

Published: Thu 29 Sep 2022, 7:41 PM

Last updated: Thu 29 Sep 2022, 7:42 PM

The highly anticipated IPO of one of Dubai’s most attractive infrastructure plays is set to raise over Dh3.7 billion, marking yet another flagship issuance on the ever-growing Dubai Financial Market and a highly successful monetisation event by the Government of Dubai

EFG Hermes, the leading investment bank franchise in Frontier Emerging Markets (FEM), on Thursday said that its investment banking division has successfully concluded advisory as joint bookrunner on the initial public offering (IPO) of Dubai’s exclusive toll-gate operator – Salik – on the Dubai Financial Market (DFM).

The IPO saw Salik offer 1.9 billion ordinary shares, representing 24.9 per cent of its share capital, at a price of Dh2.00 per share, implying total gross proceeds of over Dh3.7 billion and a market capitalisation of Dh15 billion ($4.1 billion).

EFG Hermes acted as joint bookrunner on the transaction as part of the banking syndicate advising the issuer and the selling shareholder. Salik commenced trading on Thursday under the ticker Salik. Following the transaction, Salik will remain a state-owned company, with the Government of Dubai owning 75.1 per cent of the company’s share capital.

“We are incredibly proud to have been part of this landmark transaction, which has garnered significant traction across all its tranches and from investors across the globe. The United Arab Emirates continues to be an attractive investment hub, particularly in the ECM space, despite a turbulent global economic backdrop. It continues to offer investors a dollar denominated safe-haven with very attractive long-term fundamentals while the DFM continues to offer issuers and investors a healthy venue for value creation in public markets, and Salik’s IPO is a testament to the market’s attractiveness to a wide spectrum of investors,” Mohamed Fahmi, EFG Hermes’ co-head of Investment Banking, said.

He said the issuance offers investors access to a capital efficient, world class toll-gate operator, with a robust track record, in one of the fastest growing cities in the world.

“Offering a very attractive investment proposition at a time where investors are looking for quality issuances, this IPO marks Dubai’s resurgence as an important financial hub in the GCC and will hopefully sustain the positive momentum for further offerings on the DFM in 2022.”

The offering attracted significant local and international interest, reflecting the substantial investor confidence in Salik’s business model and the long-term prospects of Dubai. Total gross demand across the offering’s tranches stood at an excess of Dh184.2 billion ($50.2 billion) – an oversubscription level of c.49x.

EFG Hermes continues to sustain its leading position in the market through its unmatched execution capabilities, as it advises on the region’s largest and most prominent ECM, DCM, and M&A transactions.

In 2022, and on the ECM front, the firm’s investment banking division advised on the $6.1 billion IPO of Dubai Electricity and Water Authority (Dewa) – the largest listing in the Middle East since 2019. Additionally, EFG Hermes served as joint bookrunner on the $ 2 billion IPO of leading Abu Dhabi-based petrochemicals company Borouge, marking the largest listing on the Abu Dhabi Exchange (ADX) to date.

The division also concluded advisory on the $323 million private placement of 45 per cent of Ali Alghanim and Sons Automotive Company ahead of its offering on Boursa Kuwait, which marked the first IPO on the Kuwaiti exchange since 2020.

— muzaffarrizvi@khaleejtimes.com


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