DP World IPO Sells $2.4bn

Dubai government owned and controlled company DP World has today been sold on open markets following its initial public offering, placing a value on the firm that owns UK based P&O Ferries of in excess of $21 billion.

The Dubai government backed business, the world’s fourth largest holder of ports for commercial docking, offered £2.4 billion worth of equity which was snapped up by investors, in relation to an overall valuation of around £11 billion, thus valuing the equity shifted at 23%.

As well as having substantial holdings in the port and sea port management industry, DP World also wholly owns P&O, giving it a foothold in the sea passenger transport market, which it is thought will show increase strength in coming years.

However it was surrounded in speculation and media frenzy following the takeover, prompting the company to sell off the entire US ports arm of P&O, a factor it had not accounted for in its initial takeover dealings.

Shares were today acquired by a collection of investment funds based in the Middle East and private investors, including individual investors who were responsible for 10% of total equity purchased. The company was responsible for handling over 23 million containers.

It remains to be seen whether the company’s value on the exchanges will increase in light of its ongoing strength and whether investors will engage in secondary trade of the securities, vital to ensuring adequate market capitalisation rates in future issues.

The company is responsible for 42 locations across the world, operating out of 22 countries managing commercial container sea ports. Previous to the IPO it was wholly owned by the Dubai government, and controlled under state authority unlike many of its competitors.

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