DUBAI: Abu Dhabi-based Gulf Marine Services (GMS) said yesterday it intended to sell shares on the London Stock Exchange to fund its growth plans, with the oil and gas services firm targeting a market valuation of $1bn once listed.
It is the latest privately-owned firm from the United Arab Emirates to look outside the Middle East for a stock market listing.
Several have chosen London, giving them access to a wider group of investors and less stringent ownership rules than in their home market.
The resurgence of local stock markets — in 2013, the value of Dubai’s bourse more than doubled, while Abu Dhabi’s climbed 63 percent — has not stemmed the tide.
Gulf Marine Services plans to sell new shares worth $100m, as well as an undisclosed number of shares currently held by private equity backers, according to a regulatory filing in London Stock Exchange.
Abu Dhabi private equity firm Gulf Capital currently owns 79 percent of Gulf Marine Services and will offer shares in the initial public offering (IPO) through two subsidiaries.
Horizon Energy and Al Ain Capital also have holdings. The statement did not specify how much each party would contribute to the initial public offering.
While the price of shares will be set at a later date, a source familiar with the matter said Gulf Marine Services was targeting a market capitalisation of $1bn after the initial public offering.
Given that a minimum of 25 percent of a company must be listed for inclusion in FTSE indices, this would indicate the initial public offering will be worth at least $250m. The source would not be drawn on a timetable for the initial public offering.
However, if Gulf Marine Services followed a traditional schedule of two weeks of roadshows and two weeks of bookbuilding, the initial public offering would take place towards the end of March.
Proceeds from the $100m sale of new shares will be used to buy a small vessel called the Keloa for $37.5m, repay $20m of shareholder loans and expand its business, the statement added.
Bank of America-Merrill Lynch and Barclays are global coordinators of the initial public offering with JP Morgan Cazenove also acting as a bookrunner. Rothschild is the financial adviser to the company.
Previous attempts to sell all of Gulf Marine Services, which started operations in 1977 and is currently the Middle East’s largest operator of jack-up barges, collapsed due to financing issues and differences over its valuation.
Since then, Gulf Capital has been preparing Gulf Marine Services for an initial public offering on a major stock exchange such as London.
“It is their strategy. We cannot force companies to list here,” Abdullah Al Turifi, the chief executive of UAE equities market regulator the Securities and Commodities Authority, said at an event on regulation in Abu Dhabi yesterday.
“But we will encourage them to dual list,” he said.
Other United Arab Emirates-based firms to have listed in London in the last two years include Dubai’s DAMAC Properties, which raised $348m in December, and Abu Dhabi-based healthcare firms Al Noor Hospitals and NMC Healthcare.
Reuters
