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DEWA utility goes public after raising USD6B in IPO

DUBAI, UNITED ARAB EMIRATES (AP) – Dubai’s Water and Electricity Authority, known as DEWA, began trading for the first time yesterday, after raising just over USD6 billion during its initial public offering, making it the second largest offering ever in the Middle East.

While that figure still trails far below the record USD29.4 billion raised by Saudi oil giant Aramco, it marks an inflection point for Dubai at a time when high oil prices are buoying the economies and spending power of energy-producing Gulf Arab states.

The government-owned utility opened trading on Dubai’s stock exchange with a market cap of AED124 billion (roughly USD33.7 billion). DEWA priced its shares at AED2.48 each, or what is USDO.68 a share. It traded, as expected, higher in its market debut, closing 16 per cent up at AED2.87 a share.

The company plans to pay dividends twice a year to investors.

The listing comes as DEWA, which is the exclusive electricity and water utility provider of Dubai, positions itself as central to the wider United Arab Emirates’ energy transition to net zero by 2050.

Dubai is an energy-intensive city of skyscrapers and an endless stream of high-end hotels and sprawling malls – including one with an indoor ski slope and another with an indoor ice skating rink – that require air-conditioning year-round to keep the Persian Gulf’s heat and humidity out. The emirate, like other parts of the Gulf, also relies nearly entirely on desalinated water plants for potable water.

DEWA said it expects to supply all of Dubai’s desalinated water capacity by 2030 using clean energy and waste heat. The money raised from the public sale of shares in DEWA could help offset some of the costs of the emirate’s energy transition.

DEWA owns 70 per cent of cooling services provider Empower, as well as bottled water manufacturer Mai Dubai, among other companies.

Emirati traders wait for the listing of DEWA on the floor of the Dubai Financial Market in Dubai, United Arab Emirates. PHOTO: AP