UAE’s Utico hires banks to advise on potential IPO

UAE-based utility Utico has hired banks including Goldman Sachs, HSBC Holdings and Standard Chartered to advise on a potential IPO in Dubai this year, joining a steady stream of companies tapping the Gulf equity markets.

The company is seeking a primary offering on the Dubai Financial Market and may consider a dual listing, according to a statement. Other banks involved in the IPO are Emirates NBD, First Abu Dhabi Bank and Citigroup.

As part of the process, the power and water utility is also planning a share buyback, it said.

“As part of the IPO preparations, shareholding changes are underway where consolidation is ongoing,” said Richard Menezes, founder and managing director of Utico. “Talks are ongoing with a major fund and an investor to acquire the firm 100 per cent from its current investors and take it for an IPO in Q4 this year.”

The Middle East IPO boom has continued to gather steam even as the Russian-Ukrainian crisis, hawkish central banks and soaring inflation have put a lid on share sales in the rest of the world.

The region has largely dodged the turbulence, buoyed by high oil prices and significant equity inflows into Gulf markets.

Utico will join utilities such as Dubai Electricity & Water Authority and ACWA Power International which have made stock market debuts in recent months and attracted enormous levels of demand.

Dubai Electricity drew orders worth about $86bn for its $6.1bn offering last month.

Utico is the largest private utility provider in UAE and is one of the 27 companies forming part of the UAE-based RMB Group, according to information on its website. It employs about 600 fulltime staff.