Toll operator Salik’s two new gates valued at Dhs2.73bn

Image credit: Christopher Pike/ Getty Images

The combined valuation of Salik’s two new toll gates is Dhs2.73bn, the Dubai road-toll operator said on Wednesday, with the Business Bay Gate valued at Dhs2.3bn and the Al Safa South Gate valued at Dhs469m.

The gates, which are expected to be operational by the end of November 2024, will expand Salik’s toll gate network in Dubai from eight to ten. They are being installed at the Business Bay Crossing on Al Khail Road and in Al Safa South on Sheikh Zayed Road, between Al Meydan Street and Umm Al Sheif Street.

Salik has the exclusive rights to construct, operate, and maintain the toll gates until the end of June 2071 under an agreement with Dubai’s Roads and Transport Authority (RTA).

The authorities expect the new Business Bay gate to reduce traffic congestion by 12 per cent to 15 per cent, while the gate in Al Safa South is set to cut congestion by 15 per cent.

“RTA has conducted detailed traffic impact studies to ensure that the placement of each gate aligns with its strategic goals for traffic management optimisation,” Salik said in a bourse filing.

“These strategic investments underscore our dedication to sustainable growth and providing more seamless mobility across Dubai by enhancing travel efficiency and reducing traffic congestion. The new gates will play a crucial role in optimising travel time and reducing congestion on some of Dubai’s busiest routes,” said Mattar Al Tayer, chairman of Salik.

Salik and RTA agreed on a six-year repayment plan for the total valuation amount of the two new gates, starting in November 2024. The annual instalment will be Dhs455.7m, paid in two equal instalments of Dhs227.9m each every six months.

With the launch of the new gates, the company expects to see an increase in annual revenue-generating trips. Salik raised its revenue-generating trips guidance to 7-8 per cent in 2024 up from previous guidance of 4-6 per cent, with a projected earnings before interest, taxes, depreciation, and amortisation margin of 67-68 per cent.

Last December, Salik partnered with Emaar Malls to deliver a seamless and efficient parking management system at Dubai Mall. Paid parking started at the mall on July 1, and it is applicable at the Grand, Cinema, and Fashion Parking.

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