Empower Said borrows $1.5 billion to fund pre-IPO dividend


(Bloomberg) – Emirates Central Cooling Systems Corp. took out a 5.5 billion dirham ($1.5 billion) loan to help pay a special dividend ahead of its IPO, people familiar with the matter said.

The district cooling company, known as Empower, borrowed money from Emirates NBD Bank PJSC to optimize its capital structure, according to the people, who asked not to be identified while discussing information private. Emirates NBD should invite other lenders to participate in the loan, one of the people said.

Empower’s current shareholders, Dubai Electricity and Water Authority and Emirates Power Investment, received 2.9 billion dirhams in dividends, according to a presentation on the company’s website. Details on the duration and price of the loan, as well as how Empower will use the remaining funds, could not be immediately known.

Founded nearly two decades ago, Empower is seeking to raise up to $700 million in an initial public offering in Dubai that could take place as early as next week, the people said. It will become Dubai’s latest privatization as part of the emirate’s push to strengthen its capital markets and position itself as a financial hub.

Empower is 70% owned by DEWA, ​​which itself listed on the stock market earlier this year. The company expects its minimum annual dividend to remain at 850 million dirhams for two years after its IPO.

Representatives for Empower and Emirates NBD did not respond to requests for comment.

Soaring oil prices and an influx of investors have helped boost IPOs in the Gulf, even as repeated bouts of volatility, inflation and stock market slumps wipe out listings elsewhere in the Gulf. the world. The Middle East is heading for its second-best year for IPOs after 2019, which included Saudi Aramco’s record float.

Empower expects capital expenditure in the range of 700 to 800 million dirhams for 2022, according to the presentation. This excludes the acquisition of 85% of the Dubai Airport District cooling assets and expenditure for the company’s headquarters building.

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