Tabreed, the United Arab Emirates (UAE)’s National Central Cooling Company (PJSC) staged an open auction of 4.6 million shares, comprising almost ten percent of its total 500 million Emirati dirham ($136.12 million) capital, at the Dubai Financial Market (DFM).
The event generated significant interest amongst local and international investors, with fourteen buyers participating in the auction and trading a total of 4,513,499 shares and Dh46.369 million.
BTU District Energy Company, an affiliate of BTU Ventures Inc., a private equity and project development company focused on mid and downstream energy and energy related industries in the Middle East, acquired 1,770,000 shares at Dh10.3.
“We have been closely following Tabreed’s progress for over a year now and believe that it represents an exceptional long-term investment opportunity,” said Wael Al-Mazidi, CEO of BTU Ventures. “Tabreed’s business model is robust and adheres to that of typical utility businesses in the US, Europe and Japan.”
“Tabreed’s management is world-class, its brand name is recognized throughout the region, and its future growth prospects both domestically and regionally are tremendous. We are confident that Tabreed will realize its true potential as the local and regional investor and investment banking communities gradually develop a better appreciation for its business model,” said A-Mazidi.
Emirates Equities purchased 1.6 million shares at Dh10.25 and Dh10.3 on behalf of a group of investors while Qatar’s United Development Co. (UDC), Tabreed’s partner in its recent expansion to Qatar, purchased approximately 500,000 shares at Dh10.2.
“A lot of investors saw today’s second and final auction as their last chance to purchase a large bulk of Tabreed shares at a bargain price,” commented Mohammed Ali Yassin, general manager of Emirates Equities. “Tabreed’s expansion in the UAE and throughout the Gulf Cooperation Council (GCC) makes it a good medium-to-long-term investment. Now that the auction program is complete, much of the pressure on the share price will be eased and we expect it to rise.”
The shares auctioned yesterday were the second and final tranche remaining after some shareholders, who paid the initial five Dh at the time of the IPO (Initial Public Offering) in June 1998, failed to pay the second installment by December 2002. The first phase of the program, completed in March 2003, saw the sale of 12 percent of Tabreed’s equity (6.12 million shares) to Abdul Raouf Al-Bitar, CEO of Saudi Arabia’s Al-Manhal Water Factories, in the first public auction of its kind on the DFM.
“Today’s auction reinforces our position as the premier district cooling provider in the region,” said Dany Safi, managing director of Tabreed. “We are delighted that companies like BTU Ventures recognize the strong foundation of success that we have built since we began trading and are keen to invest in our future.”
“Our recent expansion to Qatar and Saudi Arabia, in addition to a number of regional development opportunities, sees us extending cooling services to a diverse range of residential, commercial and government developments throughout the Gulf,” said Safi.
Tabreed has offered district cooling as a utility in the UAE for over five years, pioneering energy efficient gas-fired and electric-powered district cooling solutions in the UAE and across the region. The leading district cooling service provider in the Middle East region, Tabreed offers customers the highest quality service through an integrated energy system devised to help them optimize their energy usage and reduce power and maintenance costs. — (menareport.com)
© 2003 Mena Report (www.menareport.com)
