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Tuesday, December 7, 2021

Report: Qatar’s UrbaCon considering US$1 billion IPO

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Moutaz Al Khayyat
UCC CEO Moutaz Al Khayyat

One of Qatar’s largest construction firms has spoken to advisors about preparing the company for an initial public offering (IPO), potentially as early as the end this year, Bloomberg reported.

The business newswire said the process was at a preliminary stage and that UrbaCon Trading & Contracting (UCC) may ultimately choose not to proceed with the plans.

A spokesperson for UCC told Doha News he was unable to comment on the report.

If the IPO does happen, it would be the country’s second in five years.

UCC is currently building the massive Mall of Qatar and led the construction of Banana Island Resort.

Banana Island
Banana Island

The government’s Private Engineering Office has hired UCC for several prominent projects in recent years, including refurbishing the Sheraton Doha and constructing the Souq Waqif’s north car park.

The firm has more than 32,000 employees, according to a company brochure.

UCC is an offshoot of the Al Khayyat Group that was founded in 2011 and is led by CEO Moutaz Al Khayyat and managing director Ramez Al Khayyat.

As a private company, UCC is not obliged to disclose its revenues or profits. However, it’s been ranked among the world’s largest global contractors by the Engineering News-Record, which reportedly pegged the firm’s revenues at US$1.2 billion in 2013.

Qatar IPOs

Privately held companies may choose to go public for a variety of reasons. An IPO enables a company to raise more money and allows a firm’s early investors to cash out some of their holdings.

The higher public profile that comes with a stock market listing is also touted as a way for a company to attract more customers.

In Qatar, previous IPOs have also been used as a way to transfer wealth to citizens.

Photo for illustrative purposes only.
Photo for illustrative purposes only.

For example, when Mesaieed Petrochemical Holding Co., a subsidiary of state-owned Qatar Petroleum, went public in early 2014, officials billed it as a way of fostering a savings culture among Qataris.

They also offered citizens free additional shares as an incentive for holding their Mesaieed stocks for at least five years.

Mesaieed’s QR3.23 billion ($887.46 million) IPO remains the Qatar Stock Exchange’s only new listing since 2010.

Other large state-owned enterprises including Qatar Airways and Al Jazeera previously considered going public, but subsequently shelved their plans.

Similarly, state-owned transportation firm Mowasalat has been mulling IPO plans since at least 2011, but recently revisited the prospect of going public in a company report.

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