Cabinet 'will approve Emirates Post IPO'

Dubai: Emirates Post's initial public offering (IPO), which will offload the government's 49 per cent stake, is likely to be approved by the new Cabinet.

"The law that governs Emirates Post needs to be amended for the IPO and we are awaiting government approval," Abdullah Al Daboos, Emirates Post's director-general said.

"Once the new Cabinet starts operating, we expect it to pass the necessary amendments to clear the IPO. That is when we will offer its shares to the public."

The new Cabinet is expected to be formed by His Highness General Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of UAE and Ruler of Dubai, shortly.

This could be the first IPO of 2006 in the UAE which is blessed with huge sums of liquidity. Emirates Post will be the first government department to go public.

Emirates Post has earmarked Dh109 million budget for developing infrastructure for this year.

"Boosted by 50 per cent growth of our courier subsidy Empost, we recorded a Dh133 million net profits on revenues of Dh340 million in 2005," he said. "This is quite high for an establishment whose capital is Dh100 million.

"This is also going to be another busy year for us. We expect a further six per cent growth in net profits again this year.

"Emirates Post offers 45 types of services including many that are non-postal. We have aggressive plans to diversify businesses by making large global acquisitions to boost logistics and freighter businesses."

He said, his organisation will make a number of acquisitions this year. "We will make a number of acquisitions in logistics and freight business across the region," he said.

"In the longer term, we might operate our own aircraft to carry freight as there is a shortage in capacity on certain sectors."

In November, it acquired 60 per cent stake in Wall Street Exchange Centre, one of the UAE's largest money exchange houses, for Dh48 million.

Analysts say, as a government entity, Emirates Post's acquisition of Wall Street Exchange will help it to control the remittance business and crackdown on hawala operators.

Emirates Post also launched a direct marketing arm, Emirates Marketing and Promotions to expand its portfolio.