Dubai Investments set to boost its portfolio

Plans to conclude Dh400m acquisitions in financial, real estate sectors by mid-2015. 

Dubai — Dubai Investments, or DI, has unveiled plans to further expand its diversified portfolio by announcing two acquisitions in financial and real estate sectors for Dh400 million.

The leading investment company, which is listed on the Dubai Financial Market, is expected to conclude both the acquisitions by mid-2015 as final round of talks are still under way, according to sources.

The new acquisitions are expected to reinforce Dubai Investments’ robust growth across its 40-plus subsidiaries and joint ventures, amidst surging trends and escalating investor confidence, DI said in a statement on Sunday.

The new financial entity, with expertise in asset management, corporate advisory, debt raising and brokerage capabilities, will augment DI’s capabilities in the sector.

“The strategic move to acquire a financial services company will help Dubai Investment to prepare some of the firms in its portfolio for initial public offering in near future,” the sources said.

“We are eyeing expansion across our group portfolio and new acquisitions are in line with this strategy. The financial service company is a right fit for us and perfectly complements our model,” Khalid bin Kalban, managing director and chief executive of Dubai Investments, said in a statement to Khaleej Times.

The expansion plans come close on the heels of a successful 2014 for Dubai Investments, which saw its operations across real estate, glass and construction materials’ manufacturing businesses achieving strong year-on-year growth. DI  divested 66 per cent stake in its pharmaceutical subsidiary Globalpharma to Sanofi during the year and received overwhelming response from investors over $300 million sukuk, which was oversubscribed 13 times.

Real estate investment

Dubai Investments, which recently announced plans to invest $2.7 billion in property projects, said that the new real estate company would complement the DI’s market leadership in the property domain.

“The new real estate company will be a great addition to our portfolio, and contribute to our growth amidst the current upswing in the sector,” Kalban said.

DI, which has a paid-up capital of Dh3.8 billion, launched a number of real estate projects last year to benefit from strong rebound in the property sector. It developments include the Mirdif Hills project — a Dh2.5 billion mixed-use residential, commercial and retail development in Dubai; Dh400 million Fujairah Business Centre project being developed by its subsidiary Al Taif Investment, among others.

Over 67 per cent of Dubai Investment’s asset base is in the real estate sector and is currently worth over Dh8.2 billion — making it one of the biggest real estateplayers in the UAE.

The company also has one of the largest land banks across the UAE, totaling nearly 30 million square feet gross floor area.

“2014 has been a great year for Dubai Investments’ business growth. The real estate industry has always been a key driving force for the UAE’s economy and the unprecedented demand in the sector benefited the company immensely, given our wide presence across the entire spectrum of the industry,” Kalban said.

“We are confident that the current demand in the real estate sector will continue in the foreseeable future and we are geared to cater to the required capacity,” he added.

Kalban had previously said that Dubai Investments is planning to invest Dh3.65 billion in the UAE’s local real estate market this year.

“The investment firm is expected to announce four new projects in 2015 and details will be made public in due course of time,” the sources said, adding that projects worth Dh6.35 billion are under consideration in Dubai Investment Park — a close proximity to World expo 2020 site.

Shares in Dubai Investments rose 3.48 per cent at Dh2.38 in the broader positive market, which climbed 2.74 per cent on Sunday.