Emaar Properties has announced plans to list its UAE Real Estate development business in what will be the largest since the Emaar Malls IPO in 2014.
Subject to market conditions, Emaar will offer up to 30 percent of its real estate business through a share offering on the Dubai Financial Market (DFM) with the bulk of the funds raised to be distributed to shareholders.
The decision to proceed with a stock listing was a result of an internal review of Emaars asset values, the company said in a statement. Investors who value the proven development track record of Emaar can invest directly in this business and benefit from the strong growth profile of the companys UAE development business. In turn, this will enhance Emaars overall valuation as the value of this important business is properly recognised in the market.
Mohamed Alabbar, Chairman of Emaar Properties, said: We are thankful to His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President & Prime Minister and Ruler of Dubai, for his guidance and inspiration that has been the driving force of Emaars success.
“The proposed listing and the additional dividend to our shareholders including Government of Dubai underlines our commitment to provide superior value to all our shareholders for their unwavering support to the company since its inception in 1997.
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 Emaars 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 Emaars success, can do so directly. This will ensure that the value of this business is properly recognised, thereby enhancing value for all Emaar shareholders.
Emaars real estate development in UAE has recorded significant growth over last five years. Real estate sales increased from AED 4.2bn ($1.14bn) in 2012 to AED 14.4bn in 2016. Until end of May 2017, the business recorded sales of AED 9.7bn, 24 percent above the same period in 2016.
The company has several mega-developments ongoing in Dubai including Dubai Hills Estate, developed as a joint venture with Meraas Holding.
Emaar is also developing The Tower in Dubai Creek Harbour, which will overtake its own Burj Khalifa as the tallest building in the world.