Further to the announcement made earlier this month, Dubai’s Salik Company will begin its initial public offering (IPO) tomorrow (September 13). A strong demand is expected from both retail and institutional investors and is likely to be oversubscribed.
Comprising individual subscribers, professional investors and eligible employees, the subscriptions will open on September 13 and end on September 20 for retail investors and till September 21 for qualified investors. The company is likely to list on the Dubai Financial Market (DFM) around September 29.
Salik, which was launched in 2007 and has 3.6 million vehicles registered on the toll system, is selling 1.5 billion shares or 20 per cent of the stake through the initial public offering (IPO) to raise around Dh3.67 billion ($1 billion) for the government, as part of the city’s ongoing efforts to boost trading volumes.
Dubai plans to list 10 state-owned firms in a bid to combat years of falling trade volumes and compete with the bourses of neighboring Abu Dhabi and Saudi Arabia.
Why should you invest in Salik IPO
Salik is the exclusive operator of Dubai’s automatic road toll collection system which currently manages eight gates, in addition to any new gates in the emirate through a concession agreement lasting 49 years.
Furthermore, the company’s business model is characterized by its low capital expenditures and cash transfer margins, which are among the best in its industry. In addition, the company has many opportunities to expand in the UAE and abroad, which will contribute to increasing its size, operations and activities.
Salik will pay out dividends in April and October each year. The company will pay its first dividend for the second half of 2022 by April 2023. The company also plans to pay 100% of net profit available for distribution as dividend from 2023 onwards.
Currently, there are eight toll gates and three million registered vehicles, out of which 1.8 million are registered in Dubai. Salik reported Dh1.69 billion in revenues in 2021 and Dh94.9 million in the first half of 2022.
How to subscribe
Dubai’s largest bank Emirates NBD will be the lead receiving bank for the IPO.
Individuals looking to subscribe to or purchase shares in Salik needs to submit one subscription application each, through his or her bank or brokerage, in his or her personal name (unless he or she is acting as a representative for another subscriber).
Investors can subscribe to Salik’s IPO through Emirates NBD, Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Ajman Bank, Commercial Bank of Dubai, Dubai Islamic Bank, Emirates Islamic Bank, First Abu Dhabi Bank, Mashreq Bank, MBank and Sharjah Islamic Bank.
Subscribers or potential investors must ensure to have an updated NIN and complete all relevant fields in the subscription application along with all the required documents and submit it to the bank, together with the subscription amount expected to be made during the offer period.
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How to apply for a NATIONAL INVESTOR NUMBER (NIN)?
Apply from DFM website www.dfm.ae with the following steps:
• Register to DFM eServices at DFM website or DFM Smart Services mobile application
• Login with the username and password
• Select the eFORMS tab
• Select the form and complete it
• Attach the required documents and click on ‘Submit’
• The investor will receive the Investor Number through SMS
• You will be notified by email once the status of the request is updated
UAE nationals and residents need a valid copy of Emirates National ID, while non-residents need a valid copy of the passport.
What is the minimum investment threshold for a potential Salik investor?
Minimum subscription size for individual investors and Salik employees has been set at Dh5,000, with any additional investments can be made in lots of at least Dh1,000.
For institutional investors, the base subscription has been set at Dh1 million. There is no maximum limit, and each subscriber will be allocated a guranteed minimum of 1,000 shares.
The price range at which you, as a potential investor, can subscribe to Salik IPO shares will be in UAE dirhams and published prior to or on the day of the opening of the offer period on September 13