The price range for the planned initial public offering of Parkin shares was set between two dirhams and 2.1 dirhams ($0.57) per share, according to what the company specializing in managing parking spaces in the Emirate of Dubai announced.
The company will offer a stake of about 25 percent in the emirate's first privatization deal this year, giving it a total valuation of 6.3 billion dirhams ($1.72 billion).
Parkin said in a statement that the subscription period for its shares will extend from Tuesday until March 13, and the final price is expected to be announced the next day, expecting the shares to be listed and begin trading on the Dubai Financial Market by March 21.
At the end of last year, Parkin was occupying about 179,000 paid public parking spaces across Dubai, including about 4,000 in multi-storey parking lots. The company stated that it manages parking spaces that can accommodate about 18,000 vehicle spaces in facilities owned by developers.
Parkin, which expects to begin trading its shares on the stock exchange this month, announced revenues of 779 million dirhams in 2023, an increase of 14 percent over the previous year, while basic profits rose 23 percent to 414 million dirhams.
Reuters was the first to report in June last year that the Roads and Transport Authority in the Emirate of Dubai was studying strategic options regarding the parking arm, and invited banks to submit their offers to play roles in a possible initial public offering.
The Roads and Transport Authority is liquidating assets on behalf of the Dubai government as part of a broader privatization program to list semi-governmental companies and enhance interest in the stock exchange, while the city continues to attract large numbers of wealthy people and is witnessing strong population growth.
The Roads and Transport Authority raised $1 billion from the sale of a 25 percent stake in the SALIC toll toll company in 2022, and another $315 million in December from the sale of a 24.99 percent stake in the Dubai Taxi Company.
The two deals attracted strong demand from investors, and subscription requests exceeded the offer several times.
Parkin expects a 60 percent increase in demand for public parking by 2033, in light of Dubai's rapid population growth. The city has attracted arrivals from both Asia and Europe, thanks to a range of reforms that include easing long-term residency laws and work visas.
After the offering is completed, the company intends to distribute semi-annual dividends to its shareholders in the months of April and October, taking into account the expectations of distributing the first batch of dividends in October 2024 for the first half of 2024, with investors purchasing shares eligible to receive the full dividends for the first half. From 2024.
For the full fiscal year 2024 and beyond, the minimum dividend distribution will be the highest of two options, the first of which is 100 percent of annual profits, and the second of which is free cash flow to equity, taking into account distributable reserve requirements.
This dividend distribution policy is subject to the Board of Directors’ considerations regarding the cash management requirements of the company’s business in the context of covering operating expenses, financing costs, capital expenditures, and expected investments.
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