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Abu Dhabi developer Bloom Holding considers IPO to finance projects

2017-01-31 06:52:47

The Bloom chief executive Sameh Muhtadi said that the company was taking advice from Bain & Company and Deloitte on a five-year strategy focused on corporate governance. Christopher Pike / The National
 

Bloom Holding, the Abu Dhabi-based developer, is considering an IPO as one of a number of financing options as the company announces an ambitious list of projects.

The company, which is part of Abu Dhabi’s National Holding, said that it was getting "IPO ready" over the next two years as it evaluates a possible float alongside private placements and strategic alliances while it gears up to develop thousands of properties in Abu Dhabi and Dubai.

The Bloom chief executive Sameh Muhtadi said on Monday that the company was taking advice from Bain & Company and Deloitte on a five-year strategy focused on corporate governance which is considering the initial public offering as one of a number of ways of financing future projects.

"With the ambition that we have and with the kind of growth plans that we have, it will be most likely that we elect to float but there are alternatives," Mr Muhtadi said.

"Our plan is to be ready within a two-year time period. Whether or not we actually float is going to depend on market conditions at the time, appetite for real estate in the various sectors that we are representing and the actual need." Mr Muhtadi said the company would consider Abu Dhabi, Dubai or London to list shares.

This week Bloom said it would start leasing 225 apartments at its Bloom Marina in the Al Bateen area of the capital. It is part of a plan to increase recurring revenue streams from about 50 per cent of total company sales to 65 per cent within two years. A 225-room Edition hotel and 50 serviced apartments at the project are due to open later this year. The company said that within a week it will have completed piling work on its 207 flats and 217 hotel apartments Park View project on Saadiyat Island and it was currently working on completing piling work and foundations at its 302 Soho Square apartments, also on Saadiyat Island.

The company is set to start main construction on its 132 town house Faya scheme at its Bloom Gardens development close to Khalifa Park within two weeks. It is also about to start construction at its 686 apartment Bloom Heights project in Jumeirah Village Circle in Dubai.

The company added that in 2017 it planned to press ahead with plans to open its first two MindChamps nurseries in the UAE in Bloom Gardens Abu Dhabi and Jumeirah in Dubai.

It also plans to build a Dh500 million education campus in Barsha South in Dubai, which it expects to house the UAE’s first branch of New York-based international private Dwight School as well as a new Brighton College school, an Arabic language centre and a nursery.

The news comes a week after the Abu Dhabi-listed developer Eshraq said it would press ahead with its three debut projects in Dubai and Abu Dhabi after the company appointed a new management team led by Abu Dhabi Financial Group managing director and chief executive Jassim Alseddiqi.

"Yes we have seen a market correction over the past year or so in Abu Dhabi but if you look at the development pipeline in Abu Dhabi and don’t count the projects on Yas Island or in Saadiyat, you can see that it is very, very small," Mr Muhtadi added. "I believe there is a potential for an undersupply in Abu Dhabi in the future, especially in the city centre."

 

( courtesy of TheNational )