Dewa IPO: company increases number of shares on offer and may raise $6.08bn

The utility will now list nine billion ordinary shares, implying a deal size of 18%

Dewa is expected to list on the Dubai Financial Market on or around April 12. Reuters

Dubai Electricity and Water Authority has increased the number of shares available in its initial public offering to nine billion ordinary shares, from 8.5 billion, resulting in a free float of 18 per cent of its share capital amid “significant demand and oversubscription from retail investors”.

Dewa stands to raise between Dh20.25 billion ($5.51bn) and Dh22.32bn ($6.08bn), based on its decision to set the offer price range between Dh2.25 and Dh2.48 per ordinary share on March 24.

The increase in the IPO size was approved by the UAE Securities and Commodities Authority (SCA) and the government of Dubai will continue to own 82 per cent of Dewa's share capital, the company said on Saturday.

Including investors that participated in the third tranche — eligible Dewa employees — retail investors will represent 9.2 per cent of the total expanded deal. The retail tranche has been increased from 260 million shares to 760 million shares, it said.

Dewa, the first government entity to list on the Dubai Financial Market (DFM), operates as a vertically integrated multi-utility, with business activities including electricity generation, transmission and distribution, water desalination and district cooling.

As of December 31, it had a total electricity generation capacity of 13,417 megawatts and a water capacity of 526 million imperial gallons per day through eight majority-owned and operated plants.

The company reported revenue of Dh23.8bn and assets of Dh169.5bn in 2021. It has projects valued at about Dh86bn that are planned to be commissioned in the next five years to meet the increasing demand for electricity and water in the emirate, it said last year.

The subscription period for the Dewa IPO remains unchanged and will close on April 2 for UAE retail investors and on April 5 for qualified domestic and international institutional investors, the company said.

Dewa is expected to list on the DFM on or around April 12, 2022.

After the IPO, Dewa intends to pay dividends twice each financial year – in April and October. A minimum dividend of Dh6.2bn per annum is expected to be paid over the next five years.