Expert: It is expected that 5 to 7% will be allocated to each qualified investor

Allocating 90% of DEWA shares to institutions today.. and April 11th to individuals and employees

The oversubscription rate has reached 20 times, which is a very good percentage.

Photography: Ahmed Ardeti

Today begins the announcement of the results of allocating shares of the Dubai Electricity and Water Authority (DEWA) to institutions, with a percentage of 90% of the offering, after the subscription was closed yesterday for all categories, with the end of the subscription of qualified investors, including individuals and DEWA employees, on 2 April.

It is expected that the shares allocated to the second category (individuals and employees) will be announced next Monday, April 11.

The institutions expected to announce the privatization today include: the Emirates Investment Authority, the ADQ Holding Company, the UAE Strategic Investment Fund, the Multiplay Group, the Verfabe Holding Company, and the Istithmar Holding Corporation.

The final price and size of the offering shares will also be announced today, as well as notifying the subscribers of the second tranche of the results of the final allocation of shares, while the subscribers of the first and third tranches will be notified on April 11, 2022, and it is expected that the company will be listed on the Dubai Financial Market on April 12, 2022.

The subscription began on Thursday, March 24, by offering 6.5% of the authority’s capital, equivalent to 3.25 billion shares, after which the offering size was increased twice, to reach nine billion shares, equivalent to 18% of its total capital.

Initially, the Authority allocated 2.925 billion shares for subscription by qualified investors (including strategic investors), and then raised the volume of the offering available to them to 8.175 billion shares.

On April 2, the authority increased the number of shares available for individual subscription from 260 million shares to 760 million shares, in response to strong demand and after receiving subscription requests from individual investors that far exceeded the supply.

Earlier, the authority said in a statement that in response to the strong demand, and after receiving subscription requests from retail investors that far exceeded the supply, the Dubai government, in its capacity as the selling shareholder, took a decision to increase the size of the segment of individual subscribers from 260 million shares to 760 million shares.

Based on the price range of the offering shares, which was previously determined between 2.25 and 2.48 dirhams per share, the value of the shares allocated to the segment of individual subscribers ranged between 1.71 billion dirhams and 1.88 billion dirhams.

Thus, the category of individual investors, including the investors of the third tranche (which is allocated to the Authority's qualified employees), represents 9.2% of the total volume of the offering after the increase.

For his part, Chief Executive Officer of Strategy and Operations at Al Dhabi Capital, Mohammed Ali Yassin, told Emirates Today, "It is expected that 5 to 7% will be allocated to each qualified investor based on the subscription coverage ratio, which has reached 20 times." Which is a very good percentage,” stressing that a meeting will be held between DEWA and the subscription banks to decide the allocation amounts and liquidate the duplicate names.

And Yassin stated, “The subscription requests from qualified investors were high, so they will be allocated according to a ratio of 5 to 7%, but individuals will be allocated to them according to the (ratio and proportion) system equally,” expecting that the shares will be deposited in the subscribers’ accounts according to the announced schedule in preparation for the listing. Next week, pointing out that the final price of the stock will also be announced today.

Two billion dirhams of trading liquidity

Liquidity of trading in the local financial markets recorded 2.074 billion dirhams in each of the Dubai Financial Market and the Abu Dhabi Stock Exchange, while the performance varied, as the general index in the Abu Dhabi market rose by 0.29% at the level of 10100 points, continuing its historical rise and accompanied by transactions worth 1.6 billion dirhams. The proceeds of buying and selling 366 million shares were executed through 10 thousand transactions.

In the Dubai Financial Market, the general index declined by 0.5% at the level of 3501 points, with transactions worth 437 million dirhams, for the number of 168 million shares, while 11 shares rose, 13 fell, and five shares remained unchanged.

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