Daman Investments, a Dubai-based investment manager, has launched a new fund that will invest in UAE initial public offerings, to capitalise on the flurry of IPO activity in the country's capital markets.
The Daman UAE IPO Fund will provide institutional and professional investors with exposure to UAE companies, with the potential for significantly higher returns than the UAE's equity indices, Daman said in a statement on Monday.
With the UAE government’s continuing programme of selling stakes in state-owned entities adding to the capital markets momentum and improving liquidity, the new fund offers strong capital appreciation potential, the company said, without stating the size of the investment vehicle.
“Since its inception, Daman Investments has been a pioneer in creating differentiated product offerings that have created long-term value for our clients,” Shehab Gargash, chairman of Daman Investments, said.
Building on its legacy, the company has launched the UAE IPO Fund, which will allow investors to capitalise on “a period of strong capital market activity”.
The fund, which expects to distribute dividends on a quarterly and annual basis, will also invest in companies that have listed over the past two years and have “not yet reached their full capital return potential”, Ahmed Khizer Khan, chief executive at Daman, said.
Unlike capital markets in the US and Europe that have slumped amid inflation woes and fears of a looming recession, the UAE has experienced a flurry of IPOs, with various government-owned companies listing their shares.
Dubai last year announced plans to list 10 state-owned companies to increase the size of its financial market to about Dh3 trillion ($817 billion).
The emirate also plans to set up a Dh2bn marketmaker fund to encourage the listing of more private companies from sectors such as energy, logistics and retail.
Salik, which is Dubai’s sole toll operator, is the latest state enterprise to sell its shares in the emirate.
The company raised Dh3.735bn from its IPO on the Dubai Financial Market earlier this month in a deal that was more than 49 times oversubscribed across all tranches.
Total gross demand rose to $50.2bn, showing the strong appetite for shares of state entities.
The Salik deal followed the IPO of the Dubai Water and Electricity Authority. The utility raised Dh22.41bn from its public float, making it the largest IPO in the Middle East and Europe since Saudi Aramco went public in 2019.
Tecom, the operator of business districts in the emirate, also made its debut on the DFM in early July, having raised Dh1.7bn from its IPO a month earlier.
Since its inception, Daman Investments has been a pioneer in creating differentiated product offerings that have created long-term value for our clients
Shehab Gargash,
chairman, Daman Investments
In Abu Dhabi, Burjeel Holdings is the latest company to float its shares on the Abu Dhabi Securities Exchange. The healthcare provider will sell 11 per cent of its share capital, it said on Monday.
A string of IPOs on the Arab world's second-largest stock market has significantly improved liquidity and foreign investment on the ADX, anchoring it as one of the world’s best-performing equity markets in 2021.
Its market value climbed to Dh2.25 trillion ($614bn), as of the close of trading on Friday.
Listings on the Abu Dhabi market this year include Borouge and Abu Dhabi Ports Group.
Nine companies listed on the bourse last year, including Adnoc Drilling, Fertiglobe, Alpha Dhabi and Yahsat.
Last year, Abu Dhabi also announced a Dh5bn IPO fund to help encourage and support private companies to list on the local stock market.
“Leveraging on the strong macro-outlook and structural reforms … we launched the Daman UAE IPO Fund to be part of the economic growth story of the UAE,” Mr Khan said.
Top 10 most polluted cities
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Some of Darwish's last words
"They see their tomorrows slipping out of their reach. And though it seems to them that everything outside this reality is heaven, yet they do not want to go to that heaven. They stay, because they are afflicted with hope." - Mahmoud Darwish, to attendees of the Palestine Festival of Literature, 2008
His life in brief: Born in a village near Galilee, he lived in exile for most of his life and started writing poetry after high school. He was arrested several times by Israel for what were deemed to be inciteful poems. Most of his work focused on the love and yearning for his homeland, and he was regarded the Palestinian poet of resistance. Over the course of his life, he published more than 30 poetry collections and books of prose, with his work translated into more than 20 languages. Many of his poems were set to music by Arab composers, most significantly Marcel Khalife. Darwish died on August 9, 2008 after undergoing heart surgery in the United States. He was later buried in Ramallah where a shrine was erected in his honour.
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The specs
Engine: 1.5-litre turbo
Power: 181hp
Torque: 230Nm
Transmission: 6-speed automatic
Starting price: Dh79,000
On sale: Now
EA Sports FC 26
Publisher: EA Sports
Consoles: PC, PlayStation 4/5, Xbox Series X/S
Rating: 3/5
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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The Details
Kabir Singh
Produced by: Cinestaan Studios, T-Series
Directed by: Sandeep Reddy Vanga
Starring: Shahid Kapoor, Kiara Advani, Suresh Oberoi, Soham Majumdar, Arjun Pahwa
Rating: 2.5/5
The drill
Recharge as needed, says Mat Dryden: “We try to make it a rule that every two to three months, even if it’s for four days, we get away, get some time together, recharge, refresh.” The couple take an hour a day to check into their businesses and that’s it.
Stick to the schedule, says Mike Addo: “We have an entire wall known as ‘The Lab,’ covered with colour-coded Post-it notes dedicated to our joint weekly planner, content board, marketing strategy, trends, ideas and upcoming meetings.”
Be a team, suggests Addo: “When training together, you have to trust in each other’s abilities. Otherwise working out together very quickly becomes one person training the other.”
Pull your weight, says Thuymi Do: “To do what we do, there definitely can be no lazy member of the team.”
