Dubai road toll operator Salik surged on its stock market debut on Thursday after its initial public offering attracted $50 billion in orders, underscoring strong demand for listings in the Middle East.
Salik advanced 20% to 2.40 Dhs. The government sold 1.87 billion shares at Dhs2 each, raising the equivalent of $1 billion and a market capitalization of $4.1 billion.
Salik is Dubai’s third IPO of the year. It follows those of the city’s main utility, Dubai Electricity & Water Authority, and business park operator Tecom Group. They are part of the government’s plan to list 10 state-owned enterprises to improve the liquidity and size of its exchange.
The Middle East was one of the busiest IPO markets in 2022, a year otherwise marked by equity selloffs and recession fears. High oil prices and investor inflows have led to deals in Dubai, Abu Dhabi and Saudi Arabia, and the deal pipeline still remains loaded.
Bank of America, Emirates NBD and Goldman Sachs Group arranged the Salik deal, alongside Moelis & Co., the financial adviser for the IPO.
Arabic for open, Salik is an automated system introduced in 2007. Each time a vehicle passes through one of the city’s eight toll points, Dhs 4 ($1.09) is charged to a prepaid account, eliminating the need for cash or toll booths. The company is a key asset for Dubai, where around 60% of commuters use private cars, and net toll traffic grew at a compound annual rate of 5.5% between 2013 and 2019.
Salik’s managing director, Ibrahim Al Haddad, said Bloomberg Television On Wednesday, the company was “well placed to benefit” from Dubai’s 2040 master plan, which aims to increase annual visitor numbers to 25 million by 2025 and host more than 400 global events over the next few years.
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