DP World eyes public offering to fund growth

DUBAI: Dubai government-owned port operator DP World said yesterday it was considering an initial public offering as part of an annual review of financing needs and would decide on the cheapest way to raise the cash.The world's third-largest container port operator plans to sell 20 per cent of its shares to the public this year to raise as much as $4.2 billion to finance growth, a source familiar with the plan said. DP World chairman Sultan bin Sulayem said yesterday the company still had to decide whether to proceed with an IPO or to finance expansion through loans, bonds or existing resources.

It will depend on what is cheapest and most appropriate. No decision has been made, he said. He declined to comment on how much DP World was looking to raise.

A second source familiar with the IPO plan said yesterday that DP World was planning to sell a stake of around of 20pc but could not give the value of the deal.

The company considers an IPO among its financing options every year, Sulayem said, dismissing suggestions that a global credit crisis triggered by US mortgage defaults would make a share sale more likely this year.

We are a large company and not necessarily affected by these things, he said.

A meltdown in the US home-loan market for people with poor credit made banks more reluctant to lend, drove up the cost of corporate borrowing world-wide and forced companies to delay bond sales.

DP World, which last year bought UK-based port operator P&O for $6.8bn, would list on the Dubai International Financial Exchange (DIFX), the source said.

The company is worth about $22bn, the source said.


Source: Daily News