Just days after committing £130m to kickstart the London Gateway container port scheme, Dubai's DP World is looking for a London listing for its shares.
The global ports group – which is a division of the beleaguered Dubai World conglomerate – said the move would help address its "continued disappointment" with its market valuation.
DP World will keep its primary listing on Nasdaq Dubai, but hopes for a secondary listing on the London Stock Exchange as early as the second quarter of this year. "The board remains committed to our shareholders in the region and believe that they will also benefit from this move," the company said yesterday.
DP World's shares have not performed well since it first listed on its home exchange in November 2007: the stock was trading at about 43 cents yesterday, more than two-thirds below its $1.30 initial public offering price. It hopes that a dual listing will improve the group's access to international investors, and also help to overcome the lack of liquidity on the Nasdaq Dubai, where DP World is the only daily-traded share.
The group is not involved in the high-profile restructuring of parent Dubai World's $26bn (£16.3bn) debts. The government-backed parent group sent shivers around the world's stock markets in late November when it asked for a six-month standstill on a $3.5bn sukuk – Islamic bond – issued by its Nakheel real-estate subsidiary. In total, Dubai World's debts top $59bn, but only a portion of them is included in the restructuring process.
Unlike the property ventures, DP World is a profit-making division of Dubai World, and within days of November's debt row it was formally ring-fenced from the restructuring of other parts of the business.
DP World has strong links with the UK thanks to the £1.5bn London Gateway project it inherited when it bought the P&O shipping company in 2005. The vast plan will cover 1,500 acres, create 36,000 jobs and handle more than 3.5 million containers every year.
The plan was put on hold in March as the recession wreaked havoc in the global shipping business. The £130m committed to this will enable DP World to lay the essential foundations, but the company says it will continue to review the proposal. And although a £300m European loan has already been agreed, the scheme may need further government aid if it is to proceed.
"The London Gateway project sends a message to companies worldwide that the UK is the number one place in Europe to invest," the Business Secretary Lord Mandelson said when the initial construction funding was announced this week. "It is an excellent example of the long-term investment that the UK is looking for."Reuse content