Shuaa turns back on Kuwait bourse

MARKET MOVE: Shuaa has proposed moving its shares listed in Kuwait (pictured) to Dubai to boost liquidity. (Getty Images)

Shuaa Capital, the UAE's biggest investment bank by market value, said it is proposing moving shares listed in Kuwait to Dubai in an effort to boost liquidity and raise foreign ownership.

Shuaa, whose shares are listed in Dubai and Kuwait, is seeking investor approval to move the stock - about 100 million shares - to Dubai, said Oliver Schutzmann, head of investor relations at the bank.

The Kuwait listing was Shuaa's first, in 1984, when it was known as Arabian General Investment Corporation. Shuaa listed in Dubai in 2000.

"The aim is to improve availability to foreign investors," Schutzmann said on Monday by telephone.

Of Shuaa's 550 million shares, 18% are listed in Kuwait and the remainder in Dubai, Schutzmann said.

Of all the stock, UAE nationals own 52%, other Gulf Arab citizens 21.3%, other Arabs 3.7% and other foreigners 22.7%, Schutzmaan said. Of the foreigners, about half are registered in Britain.

UAE law limits ownership by non-nationals to 49%.

Shuaa is also seeking to re-categorise shares owned by other Gulf Arab citizens as UAE investors, giving other foreign investors more opportunity to own Shuaa stock, Schuztmann said.

Shuaa shareholders are due to meet next month to consider the Kuwait and other proposals, according to a statement on the Dubai bourse website.

Shuaa is one of the least liquid shares on the Dubai exchange, according to data from newswire Reuters.

In the last 90 days, an average of 1.4 million shares traded each day, compared with 61.3 million for Air Arabia, the most liquid stock.

In Kuwait, daily average trade in Shuaa stock during the last three months was 105,000, according to Reuters data.

Shares of Shuaa in Dubai are up more than 27% this year and in Kuwait more than 18%, compared with a decline of almost 4% and a rise of 19% in the respective main stock indexes.

HSBC Holdings in March began coverage of Shuaa with an "overweight" rating and a price target of 12.60 dirhams ($3.43), saying the company is benefiting from a buoyant UAE market.

The brokerage said Shuaa's further regional expansion and focus on fees business added to the stock's appeal. The stock last traded at 8.28 dirhams. (Reuters)

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