Construction

ASGC still considering IPO says CEO

Bishoy Azmy says idea has not been completely dismissed, but current market conditions are not favourable

Bishoy Azmy, CEO of Al Shafar General Contracting (ASGC), has said that the UAE-based general contractor is still considering holding an Initial Public Offering (IPO), but said that it would be dependent on improvements in market conditions.

Speaking during an interview with Zawya, Azmy said that the idea has not been completely dismissed, but that current market conditions were not favourable for a construction company to go public immediately.

“We are growing as a company and that (the IPO) is not something that is impacting our investment strategy or our growth strategy, but we still firmly believe in it in the long term,” he said during the interview.

The contractor had started preparations for an IPO in late 2015, having hired three banks as advisors to arrange for its listing on the Dubai Financial Market, a Reuters report said at the time, quoting sources familiar with the matter.

However, that process was suspended due to the economic slowdown across the GCC, following the decline in oil prices, which began in 2014. The market for IPOs has also witnessed a slowdown over the last two years, the Zawya report added, but pointed out that the listing of shares in Dubai’s Emaar Development, Abu Dhabi’s ADNOC Distribution and several real estate investment trusts in Saudi Arabia in the last quarter of 2017 had raised $3.2 billion on local exchanges last year.

Azmy said that any private enterprise would need to move into the public domain at some point in time, so as to remain sustainable, but added that it was not yet clear when ASGC would make such a move.

“Whether it (the IPO) is some time later this year or next year or some time this decade or next decade, it will be something we still want to do,” he concluded.

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