Emaar Properties plans IPO for UAE real estate development business

Emaar Properties plans to float its UAE real estate development business on the main Dubai bourse, the company announced this morning.

In a stock exchange statement, Emaar said it will offer up to 30 per cent of its UAE Real Estate Development business through a share offering on the DFM.

The developer did not say when the listing was likely to occur, or how much it was expected to raise.

Emaar said the funds raised would be be “primarily distributed as dividends to Emaar’s shareholders”.

The company said the decision to list Emaar’s UAE Real Estate Development business was as a result of an internal review of Emaar’s asset values.

“Over the years, we have generated significant returns from our UAE Real Estate development business and it continues to be a strong driver of growth for the group. As Emaar’s other businesses have grown and expanded, we wanted to ensure that investors who value the UAE Real Estate Development business the most, the foundation of Emaar’s success, can do so directly,” said Mohammed Alabbar, Emaar ‘s chairman.

“This will ensure that the value of this business is properly recognised, thereby enhancing value for all Emaar shareholders.”

Emaar, a Dubai-based property major, has been engaged in plans to spin off various parts of its business for the past five years.

In 2014 the company floated its Emaar Malls business on the DFM and in 2015 the company floated its Egyptian unit on the Cairo stock market.

Emaar has been widely expected to spin off its hospitality business.

It said real estate sales at its real estate development business in the UAE increased from Dh4.2 billion in 2012 to Dh14.4bn in 2016. This year, to the end of May 2017, the business recorded sales of Dh9.7bn, 24 per cent above the same period in 2016.

Emaar said the division’s total backlog – representing the value of properties that have been sold but whose related revenues had not been recognised – as at the end of May was Dh40bn.

Emaar shares rose 5.71 per cent in early trading on Wednesday, standing at Dh7.4 at 10am UAE time.


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