The Dubai government is seeking to raise about $1 billion by selling shares of road-toll collection system, Salik, as soon as next month, Bloomberg reported citing people familiar with the matter.
Salik is said to have taken out a $1.1 billion loan from Emirates NBD to pay a special dividend to the government, anonymous sources informed Bloomberg. The sources also mentioned that other IPO candidates in Dubai took out similar loans.
According to the sources, the toll operator aims to stage the IPO in September. And although it's still unclear how many shares will be offered, the Dubai’s government has announced earlier that it will retain a minimum 60% stake.
It's worth noting that Salik is one of 10 proposed privatizations in Dubai as part of its plans to bolster its capital markets, with the most recent listings of supermarket chain Union Coop and real estate giant TECOM Group.
Salik is an automated system launched in Dubai in 2007. Each time a vehicle passes through one of the city’s eight toll points, 4 AED ($1.09) are charged to a prepaid account.