DP World to silence critics with Dubai IPO

The stock market listing of DP World, Dubai’s state-owned container port operator, will provide a riposte to critics of the lack of transparency in the Gulf emirate’s many government-owned companies, DP World’s chief executive said on Sunday.

Mohammed Sharaf was speaking after the company confirmed plans to list 20 per cent of the company’s shares – currently held entirely by government-owned Port & Free Zone World – on the Dubai International Financial Exchange by the end of November.

The Dubai listing is to be the only one for the shares, in spite of earlier speculation the company might seek a secondary quotation on the London Stock Exchange, where P&O, the port and ferry operator it bought in 2006, used to be listed.

The move to a public listing will represent a major opening-up to scrutiny of the finances of DP World, the world’s number four container port operator, which has never before published financial figures.

The first figures, published on Sunday, showed it made earnings before interest, tax, depreciation and amortisation of $705m on turnover of $2.08bn during 2006, and $454m ebitda on sales of $1.21bn in the first half this year.

Mr Sharaf said Dubai’s government-owned entities had been criticised for their lack of transparency, which had led to accusations the companies were operating with subsidies from Dubai’s authorities.

“This will be a chance for the world, to show them that we are running as an international, global organisation, without any financial support from the government,” he said.

Among the other companies to have faced criticism from competitors over transparency is Emirates, Dubai’s fast-growing government-owned airline.

Mr Sharaf said that all of the shares to be listed would be sold by Port & Free Zone World and that it would retain the proceeds, rather than reinvesting them in
DP World.

On the London listing, Mr Sharaf said that although the company had announced it intended to list in London, after two years of considering its options it had decided that, since it was a Dubai-based company, it was best to stick with a Dubai-only listing on the relatively new DIFX.

“You may say it’s an untested platform – well, Dubai is known for that,” Mr Sharaf said.