The Ministry of Economy Prescribes a Limit of One Billion Dirham For New IPO Issues

The committee of joint stock companies of the Ministry of Economy has decided to prescribe a maximum limit for the capital of new Initial Public Offerings so that the total value of IPOs will not exceed AED one billion monthly. This initiative is to ensure the stability of liquidity and cash flow in the money markets.

Ministry sources stated that the Ministry has approved the offering of three joint stock companies who have been given the green light but whose IPO time schedules have not yet been set. These companies include CERT, Abu Dhabi Holding, and Gulf Navigation Company.

The sources added that what is applicable to new public companies will also apply to the increase of capital of existing public companies. The Ministry has agreed to increase the capital of seven joint stock companies.

It was noted that flexibility will be ensured in dealing with the one billion dirham limit, whereby there is a possibility for reducing or increasing this amount from one month to another. For example Dubai National Bank has obtained approval for increasing its capital by approximately 1.5 billion dirham.