Dubai Investments divests stake in private equity arm

Dubai: Dubai Investments has divested 40 per cent of its shareholding in M'Sharie, its private equity arm, via a private placement targeted towards selected strategic investors across the Gulf Cooperation Council (GCC).

The private placement was oversubscribed by more than 100 per cent.

Valued at Dh1 billion, M'Sharie holds ownership interest in 16 companies operating in diversified businesses, of which 14 are fully-owned subsidiaries and two are joint venture affiliates.

The divestment of M'Sharie will allow Dubai Investments to raise capital of Dh400 million.

"The private placement of M'Sharie is a strategic move aimed at establishing a strong presence for the company within the GCC market and ensuring its continual growth by offering shareholding to a select group of investors from the UAE and the GCC," said Khalid Kalban, CEO of Dubai Investments.

Strategic decision

"We have put ourselves in a better position to enhance M'Sharie's performance through the introduction of commercial relationships from new shareholders, and form strategic alliances that could expand M'Sharie's acquisition activities to other GCC countries," Kalban added.

Regional investors, who acquired an equity stake in M'Sharie, include the UAE's National Bonds Corporation, Al Mal Capital, The First Investor, Al Arif Investment, Bahrain's Gulf International Bank, Saudi Arabia's Abdul Aziz Al Ajlan Sons and Ali Bin Hassan Dayekh.

The legal formalities are expected to be completed by the end of September. Thereafter, a new board of directors will be constituted for M'Sharie.

Gulf International Bank was the placement agent for the deal, and was responsible for advising Dubai Investments on the structure of the placement process as well as on conducting the financial due diligence of M'Sharie and its group companies.