Du, the UAE’s second largest telecoms operator, concluded a Dh1bn (US$272.2m) rights issue this month.
The money will be invested in the development of du’s infrastructure. The rights issue was oversubscribed.
More than 571.4m shares were offered at…
Du, the UAE’s second largest telecoms operator, concluded a Dh1bn (US$272.2m) rights issue this month.
The money will be invested in the development of du’s infrastructure. The rights issue was oversubscribed.
More than 571.4m shares were offered at Dh1.75 each to du’s major shareholders, Dubai Holding, the investment company of Sheikh Mohammed al Makhtoum, Ruler of Dubai, and Mubadala Development, a strategic investment company owned by the Abu Dhabi Government. The remaining 20% was offered to investors on the Dubai Financial Market.
According to Abu Dhabi’s The National newspaper, analysts viewed the conclusion of du’s rights issue as a positive move for the company, which began offering mobile and internet services in 2007.
“The stock is cheap and it’s a more stable business compared to other sectors,” said Simon Simonian, telecoms analyst for Shuaa Capital. “With the rights issue now behind them, the outlook for du is positive.”
Simonian said the additional capital would help to improve the quality of du’s mobile and broadband network as well as with investments in other ventures.
The operator is set to tap into Etisalat’s broadband network in the coming weeks to offer its internet and television services nationwide. “The mobile network is pretty much complete but it strengthens the balance sheet and gives du some more options,” Simonian said.