Dubai’s Main Utility DEWA Readies for Share Offering by April

Dubai is planning to list its main utility by April, in what will likely be the city’s biggest initial public offering since DP World in 2007.

“I think we’ll be ready before Ramadan,” Dubai Electricity & Water Authority Chief Executive Officer Saeed Mohammed Al Tayer told Bloomberg when asked about the timing of the proposed IPO. The Islamic holy month of Ramadan is expected to start in April.

Dubai’s Deputy ruler Maktoum bin Mohammed bin Rashid said earlier this month that the emirate will sell a stake in DEWA “in coming months.” The IPO may value the utility at more than $25 billion, according to people familiar with the matter.

Dubai this month announced plans to list some 10 state-owned companies on its stock market as it looks to reverse a decline in trade that’s left it in the shadows of Abu Dhabi and Riyadh. That ambition got a fresh lift on Monday when the chairman of Emirates airline said it may also sell shares to the public.

DEWA has invited banks to pitch for a role on the IPO and named Moelis as an adviser, people familiar with matter said. The state-owned company will probably choose a mix of international and local banks, they said.

DEWA caters to the emirate’s 3.4 million people. Along with its subsidiaries, it has assets worth up to 190 billion dirhams ($52 billion). It reported net income of 4.9 billion dirhams in 2019, the latest data available to Bloomberg.

It became debt free after repaying its last commercial bond last year, according Al Tayer. The company has other unused credit lines and uses project financing for specific facilities.

Al Tayer said Tuesday that DEWA doesn’t intend to borrow from international capital markets in the near term. “Why should I go to the market?” he said. “We’re making an excellent profit. Our financial KPIs and technical KPIs are excellent.”