Deyaar IPO and prospectus

Deyaar Development PJSC IPO

The Deyaar Development PJSC IPO at AED 3.2 billion is the largest in the UAE as of April 2007. Previously, the largest IPO in the UAE was the Air Arabia IPO at AED 2.67 billion in March 2007. The expected Emirates Post IPO could be a similar size to the Deyaar IPO and may even be larger.

The Deyaar IPO runs from 06-16 May 2007 and is only open to UAE and GCC citizens. The CEO said the reason for ownership limitation was because Deyaar was a property company and foreign ownership of Deyaar shares would conflict with limitations on foreign ownership of property in the UAE.

Deyaar IPO sign up procedure

If you want to sign up for the Deyaar IPO, you need to do a couple of things.

1. Go to the DFM (Dubai Financial Market) and obtain an investor number. You can either do this directly, or some of the DFM brokers will do this for you. See the new investors page for the sign up procedure, and the UAE stockmarket subscription forms page for the paperwork. See the brokers page for a list of brokers, or the broker discussion list for opinions and comments.

2. Go to one of the receiving banks (list at end of page) to collect the Deyaar IPO subscription forms. Fill them in as per instructions and hand them back to the receiving bank along with money and any other required paperwork needed. Then wait.

This is not the official Deyaar IPO prospectus. Obtain it from one of the receiving banks. Section highlighting by ShareWadi.com

Deyaar IPO Prospectus

(Under establishment in the Emirate of Dubai, United Arab Emirates)

Notice for the Initial Public Offering of 3,178,000,000 common Shares only to individual and institutional investors that hold the nationality of the UAE or other countries of the GCC, representing 55% of the Company’s share capital at an Offer Price of AED1.00 per Share (with an additional AED0.02 per Share in Offering Costs).

Deyaar Development (under establishment) (the “Company”)

Based in the Emirate of Dubai, Deyaar is a leading local and regional real estate developer and real estate services company. At inception, Deyaar was the property management unit of Dubai Islamic Bank. Deyaar was later established as a private shareholding company on January 6, 2001 and commenced operations on June 1, 2003.

The overall economic growth in the UAE, and Dubai in particular, led to the significant growth in the real estate sector, which was conducive for Deyaar to expand the scope of its property management operations to include property development and investment activities. Deyaar became increasingly involved as a real estate developer, also expanding into complementary business lines such as real estate brokerage, property management, facilities management and rent-to-lease.

Deyaar has completed and is currently developing a number of notable real estate projects, solely or through joint venture partnerships in the UAE and the Middle East region. Deyaar has a geographically balanced portfolio of real estate projects under development and land bank assets for future development, and has significant growth plans to continue expanding into new international markets.

Deyaar’s principal strategy is to develop and sell residential and commercial properties with the aim of maximizing investor returns and simultaneously providing comprehensive services and care to its customers and tenants. Deyaar seeks to capitalize on its current project portfolio as well as its new projects to be developed to establish itself as a leading player in the real estate sector in the region.

In February 2007, the Company’s founders applied to the UAE Ministry of Economy and the Emirates Securities and Commodities Authority to establish Deyaar Development PJSC (a public joint stock company under formation) in accordance with the requirements of the Commercial Companies’ Law in the UAE.

The Founding Shareholders (the “Founders")

The Founders of the Company whose names appear below, have subscribed to 2,600,000,000 Shares, representing 45% of the Company’s share capital, paid for in-kind in the form of shares in Deyaar Development PSC. The total value of the in-kind contribution has been at AED2,600,000,000 and a price of AED1.00 per Share, as reflected in Article 6 of the Memorandum of Association and Article 8 of the Articles of Association.

Name	Nationality	Value (AED)	No of Shares
Dubai Islamic Bank	UAE	2,482,996,360	2,482,996,360
Sequia Investments LLC	UAE	117,000,260	117,000,260
Deyaar Funds LLC	UAE	260	260
Deyaar Investments LLC	UAE	260	260
Bulwark Investments LLC	UAE	260	260
Optimum Investments LLC	UAE	260	260
Rubicon Investments LLC	UAE	260	260
Osiris Investments LLC	UAE	260	260
Lotus Investments LLC	UAE	260	260
Premiere Investments LLC	UAE	260	260
Landmark Investments LLC	UAE	260	260
Blackstone Investments LLC	UAE	260	260
Blue Nile Investments LLC	UAE	260	260
Momentum Investments LLC	UAE	260	260
Mount Sinai Investments LLC	UAE	260	260

The Founders Committee

The Founders undertake to complete all the necessary procedures to finalise the incorporation of the Company. To that end, the Founders have appointed a committee comprised of five (5) members to complete the establishment process with the relevant regulatory authorities. The Founders’ Committee is comprised of the following members

Name	Position
H.E. Minister Dr. Mohammed Khalfan Bin Kherbash	Chairman
Mr Saad Mohammed Sharif Abdul Razak	Member
Mr Khalid Mohammad Ali Al Kamda	Member
Mr Abdul Monem Mohammed Mohammed Rafee Bastaki	Member
Mr Zack S. Shahin	Member

Board of Directors

The Company’s Board of Directors will be composed of nine (9) members, to be elected by the General Assembly of Shareholders for a period of three (3) years. The majority of the Directors, in addition to the Chairman, are required to be UAE nationals. As an exception, and as permissible by the Commercial Companies’ Law, the Founders have named the following individuals as Directors of the Company’s first Board of Directors that will serve for a period of three (3) years from the date the Company is incorporated.

Name	Position
H.E. Minister Dr. Mohammed Khalfan Bin Kherbash	Chairman
H.E. Minister Sultan Saeed Mohd Al Mansoori	Vice Chairman
Mr Sultan Ahmed Khalfan Al Ghaith	Director
Mr Hussain Hassan Mirza Mohd Al Sayegh	Director
Mr Khalid Mohammad Ali Al Kamda	Director
Mr Saad Mohd Sharif Abdul Razak	Director
Mr Khalifa Suhail Juma Al Zaffin	Director
Mr Younis Haji Abdulla H. Al Khoori	Director
Mr Khaled Abdulla Mohamed Abdulla Al Mass	Director

Dividend Policy

The Company is expected to adopt a dividend policy of distributing at least 25% of it’s net income as dividend payments, subject to bank financing, working capital and capital expenditure requirements. Dividend payments will be upon the recommendation of the Company Board of Directors and the approval of the General Assembly of Shareholders.

Dividends (profits) accumulated during the period from January 1, 2007 to the date of incorporation of the Company as announced by the respective regulatory authorities will be distributed by the Company to the Shareholders of Deyaar Development PSC. In the event that the proceeds from Offering Costs exceed the costs of establishing the Company, then the excess will be registered as income in the Company’s register.

Financial Year and First Financial Period

The financial year of the Company will start on the 1st of January and end on 31st of December of each year. The first financial year of the Company will start upon incorporation of the Company and end on 31 December 2008.

Auditors

The Company expects to retain the services of Ernst & Young as auditors following the establishment of Deyaar Development PJSC. The auditors of Deyaar Development PJSC will be formally appointed at the first Annual General Meeting of the Company.

Summary of the Offering

Share Capital: AED 5,778,000,000 divided into 5,778,000,000 Shares with the nominal value of each share being AED1.00.
Offered Shares: 3,178,000,000 fully paid ordinary Shares with a nominal value of AED1.00 per Share representing 55% of the Company’s total issued share capital.
Offer Price: The Offer Price of the Offered Share is AED1.00 (with additional AED 0.02 per share as Offering Cost).
Eligible Investors: The Offering will be limited to individuals and institutional investors that hold the nationality of the UAE or other countries of the GCC. Individual investors must be at least 21 years of age on the date of the closing of the Offering.

Summary of Subscription and Allocation Policy

Upon the closing of the Offering, the Offer Shares will be allocated as follows:

Tranche (I): Retail Tranche

Size of Tranche (I): 635,600,000 Shares.
Tranche (I) will only be open to individual Subscribers that hold the nationality of the UAE or other countries of the GCC who have submitted applications for a minimum of 10,000 Shares and a maximum of 50,000 Shares. Subscription to any additional Shares in this Tranche will be in multiples of 5,000 Shares.
Shares in Tranche (I) will be allocated on a pro-rata basis, with a minimum allocation of 2,000 Shares per Subscriber.
In case the number of submitted applications exceeds the maximum number of applications available for Tranche (I) (317,800 applications), then the minimum allocation will be reduced in proportion to the increase in the number of applications submitted.
If the number of Shares subscribed does not cover the Offer Shares in Tranche (I), then Subscribers will be given full allocation, with the remaining Shares being transferred to Tranche (II).

Tranche II: High Net Worth Individuals and Institutional Tranche

Size of Tranche (II): 2,542,400,000 Shares.
Tranche (II) will be open to individual and institutional Subscribers that hold the nationality of the UAE or other countries of the GCC who have submitted applications for a minimum of 55,000 Shares or more. Subscription for any Shares in this Tranche will be in the multiples of 5,000 Shares.
Shares in Tranche (II) will be allocated on a pro-rata basis.
If the number of Shares subscribed for does not cover the Offer Shares in Tranche (II), then Subscribers will be given the full allocation which they requested, with the remaining Shares being transferred to Tranche (I).

In accordance with the Council of Ministers’ Resolution number (8) for 2006, the Ministry of Finance and Industry has the right to subscribe for up to 5% of the Offering. The Ministry of Finance will be allocated the full percentage it will subscribe to prior to the allocation of Shares. Accordingly, the Offer Shares available in Tranche (II) will be reduced according to the decision of the Founders’ Committee.

Foreign Ownership

The Offering of the Company’s Shares is open to both UAE national and GCC national individual and institutional investors subject to UAE share ownership restrictions 51% UAE nationals and 49% non-UAE nationals.

The Lead Manager reserves the right to allocate the Offer Shares to guarantee conformity with the provisions of the Commercial Companies’ Law and the Articles of Association.

Important Dates

Offering Opening Date: 06 May 2007
Offering Closing Date: 16 May 2007
Allotment Date: 30 May 2007
Refund Date: Receiving Banks in the UAE - 30 May 2007
Refund Date: Receiving Banks in the GCC - 04 June 2007

Subscription and Incorporation Expenses

The Offering Costs are AED0.02 per Offered Share. It is expected that the proceeds from the Offering Costs will cover the costs of establishing the Company. In the event that the costs for establishing the Company exceed the proceeds from the Offering Costs, then the deficit will be registered as an expense in the Company’s register. In the event that the proceeds from Offering Costs exceed the costs of establishing the Company, then the excess will be registered as income in the Company’s register.

Subscription Procedure

Documentation Required by Subscribers

Subscribers shall submit the following documents along with their subscription application:

A. Individuals

A true copy of a valid passport
A true copy of the national family book (Kholaset Kaid) including the cover, the pages that contain details of the family head and of the subscriber for UAE nationals; or equivalent national identification card for GCC nationals.

B. Entity (company or establishment) formed in the UAE or the GCC

A true copy of a valid trade license, certificate of incorporation or registration, or equivalent.
Proof of representative’s authority to submit, sign and accept the terms and conditions of the subscription application on behalf of the entity.

True copies of documents must be verified by presentation of the original or by written certification by any of the following; a notary public, embassy, bank, lawyer, or accountant.

All submitted documents must be valid on the Offering Closing Date.

All Subscribers must submit a copy of the DFM Investor No. card, if one is already issued in the subscriber’s name. It is encouraged that subscribers who do not have a DFM Investor Number apply for one prior to submitting the subscription application.

Receiving Banks

Offering prospectus & subscription application forms will be available at the IPO designated branches of the following receiving banks:

Bank - Contact tel numbers

ADCB 800 2030
Arab Bank 800 27224
Commercial Bank of Dubai 800 223
Commercial Bank International 800 224
Dubai Bank 800 5555
Dubai Islamic Bank 04 4277444 (Lead Receiving Bank)
Emirates Bank 04 3160300
Finance House 800 3434
First Gulf Bank 800 3476
Mashreq Bank 04 2174800
National Bank of Abu Dhabi 02 6161816 - 6161819
National Bank of Fujairah 02 6773353
Sharjah Islamic Bank 800 742
Standard Chartered 04 5070340
Union National Bank 800 2600
Qatar - Standard Chartered +974-4658555
Oman - Standard Chartered +968-24788364 & 5
Bahrain - Standard Chartered +973-17220522

Interested investors are required to submit the subscription form at one of IPO designated branches of the above-mentioned receiving banks, during the Offering period.

This is not the official Deyaar IPO prospectus. You should obtain it from one of the receiving banks (see list above).

Disclaimer: ShareWadi.com and DubaiShareTalk.com provide UAE stockmarket related information, but do not offer investment advisory services, or brokerage services. Investing in shares is risky, you can lose some or all of your money and/or other assets. Anything you read on this site should be regarded as the opinion of the author only and is not to be taken as advice to buy, sell, or hold shares and/or other investments. Do not make investment decisions without due diligence and/or professional advice. In particular, do not assume anything you read on this site is correct or accurate. You should make your own investigations to determine if information is accurate and ultimately, you should accept that you and you alone are responsible for any investing decisions you make.

Copyright © ShareWadi.com 2005-2008. Any company names or product names used on this site, discussion forum, and/or communications from anyone associated with this website are the trademarks or registered trademarks of their respective holders.
This page last updated 23-Aug-2007. E & OE.