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18 February 2020

DP World to delist from Nasdaq Dubai, return to full state ownership

After the approval of the company’s return to private ownership, DP World will become 100 per cent owned by its parent company Port and Free Zone World, which is a wholly owned unit of Dubai World

Delisting from Nasdaq Dubai is in the best interest of the company, enabling it to execute its medium to long-term strategy/Bloomberg

by Kudakwashe Muzoriwa

Dubai's DP World, one of the world’s biggest ports operator, has announced that it will delist from Nasdaq Dubai and return to full state ownership in a deal valuing the company at $13.9 billion.

DP World stated that its parent company Port and Free Zone World (PFZW) has offered to acquire the 19.55 per cent of its shares traded on Nasdaq Dubai, returning the company to private ownership.

Each DP World share will be acquired at $16.75, representing a 29 per cent premium on the market closing price of $13 on 16 February 2020, said DP World. 

In a bourse filing, DP World said that PFZW will finance the transaction in new facilities arranged by Citibank and Deutsche Bank.

Additionally, PFZW will also provide $5.15 billion in funds to Dubai World, helping it meet outstanding obligations to lenders so that DP World can implement its strategy without restrictions. PFZW already owns 80.45 per cent of the ordinary share capital of DP World.

The move will enable the Dubai-based ports operator to focus on its medium-to-long-term strategy of transforming from a global port operator to an infrastructure-led end-to-end logistics provider, said DP World.

Yuvraj Narayan, DP World’s Group Chief Financial, Strategy and Business Officer, said that the DP World board concluded that the disadvantages of maintaining a public listing outweigh the benefits.

Delisting from Nasdaq Dubai is in the best interest of the company, enabling it to execute its medium to long-term strategy, added Narayan.

Returning to private ownership will free DP World from the demands of the public market for short term returns which are incompatible with this industry and it will enable the company to focus on implementing its mid-to-long-term strategy to build the world’s leading logistics provider, said Sultan Ahmed bin Sulayem, DP World’s Group Chairman and Chief Executive Officer.

The port operator, which listed on the Nasdaq Dubai in 2007, has diversified its operations in recent years to include industrial parks, transportation, and other logistic services assets.

DP World plans to continue integrating its acquisitions with the firm’s global network of interconnected ports, logistics businesses and economic zones.

RELATED STORIES: DP World Nasdaq Dubai Port and Free Zone World





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