Mohammed Sharaf has been chief executive of DP World since the company was formed in 2005, but has a pedigree in the business going back to his first job in the port of New York in the 1980s. He spoke to The Nationalas he became the first Emirati chief executive of a company listed in London.
DP World shares are about to be traded on the London Stock Exchange. How important an event is this in the company's history?
Listing in London is a very significant milestone for us. We have grown over the past 40 or so years from a local to a regional to a global company with operations in 31 countries around the world. Today we are the third-largest container terminal operator with around 10 per cent of the world market. We've come a long way in quite a short time, and this is yet another step in that journey.
In terms of being a publicly listed company, we have laid a solid foundation over the last three years with our listing on Nasdaq Dubai, but investors' feedback, particularly international fund managers', has been that while they like us and they'd like to invest, their internal rules prevent them doing so. They told us that a listing elsewhere would give them access. We looked at various different exchanges and we decided that London was the right place for a dual listing - the regulatory framework is very similar to Nasdaq Dubai's, a large number of emerging market funds are based in London and, last but not least, the time zones give us an extra day and an additional 12 hours trading over a week.
DP World will now be positioned alongside regional companies on Nasdaq Dubai and some of the world's leading companies on the London Stock Exchange - a great outcome for all our shareholders.
You have been canvassing shareholder opinion about a possible London listing for some time. What reaction did you have from potential investors to the announcement of a definite date for listing?
Thrilled, in a word. It really makes our stock more accessible to more traders, and that has to be good for everyone. I have to add here that we are not expecting any dramatic change in trading today. Markets take time to respond to such events, and we expect that the market will develop over time.
Has the presence of a large government shareholder in the form of Dubai World been a positive or a negative?
It's been a positive for us. We have had excellent support from Dubai World over the years. They have fully supported our initial expansion outside of Dubai and also our drive to become a truly global player with the acquisition of CSX World Terminals in 2005 and P&O in 2006. It's certainly not unusual in world markets to have a majority government-linked shareholder; there are many companies with sovereign fund investors that are publicly listed.
What feedback are you getting from advisers regarding the stock's performance expectations over the next six months to a year?
That's not something I can really comment on as many factors drive stock performance. However, we hope that by attracting a broader range of investors and sitting alongside international companies on the London Stock Exchange we will, over time, be better positioned than we are today. That said, of course it goes without saying we have to continue to deliver improving operational and financial performance - which is what we as a management team are focused on.
What are the most important factors to determine share price performance: Trading outlook? Greater liquidity? Comparative shortage of stock (with 80 per cent of DP World held by Dubai World)?
This is also not a question for me to be answering, but for the experts in the financial sector.
What is DP World's view on the possibility of increasing liquidity via a sale of shares by Dubai World?
Our primary goal has been to list the company on London to broaden the potential investor base, and that is our immediate focus.
In the prospectus you identify the Port Khalifa project as a risk factor that could affect DP World's profitability. How seriously do you regard this risk?
Risk factors listed in the prospectus, by their very nature, outline all possible scenarios to make sure investors consider all elements of a company when investing. This particular risk factor talks about the possibility of competition for any of our ports, using Port Khalifa and Jebel Ali as an example. As we have said previously, efficient infrastructure supports economic growth, and Port Khalifa will make a very real contribution to the growth of Abu Dhabi and the UAE.
Why aren't you raising capital with this listing?
We don't currently need to raise capital. We have a very strong balance sheet and ours is a cash-generative business, which means we can continue to invest in our terminals and new developments. We are listing in London to give investors another window through which they can invest in our shares.
