DP World plans IPO launch in 18 months

Dubai: DP World, the world's third-largest container port operator, said yesterday it intended to launch an initial public offering (IPO) in 18 months to create a shareholder base that matches its global profile.

The Dubai-owned company announced late last year at the time of bidding for British port and ferries group P&O that it would offer its shares to investors within two years.

"We have discussed an IPO. It remains our intention to hold a public listing," a DP World spokewoman told Gulf News.

She said an IPO was needed because "we are now global and shareholding base has to match that."

DP World refused to disclose the value of its IPO or the place where the shares would be listed.

The Dubai International Financial Exchange (DIFX) remains a possibility, the spokeswoman said.

CEO Mohammad Sharaf confirmed that the company remained committed to the IPO plan.

DP World acquired P&O for $6.8 billion (Dh25 billion) in February. It is planning to spend over $3 billion to build new container ports and expanding those under its management.

Bloomberg yesterday quoted Yuvraj Narayan, DP World's senior vice-president for corporate strategy, as saying that the company was planning to sell shares.

"We are planning to sell shares, and it won't necessarily happen in just one or two shots," Narayan said.

The report said Deutsche Bank, Merrill Lynch, Dubai Islamic Bank and Dubai-based Shuaa Capital had been hired as advisers and a date for the first share sale had not been set.

In January, DP World sold $3.5 billion worth of sukuks. The Islamic bonds, which mature in January 2008, are convertible into shares and are listed on the DIFX.

"Investor interest in port operators is as high as it has ever been," Neil Davidson, research director for Drewry Shipping Consultants, said. "DP World is not alone in following the IPO route. [Singapore port firm] PSA is understood to be considering it, as are some Chinese ports."

DP World may now be worth as much as $10 billion after buying P&O, he said.