Future Pipe to borrow $150mn after shelving IPO

REFINANCING DEBT: Future Pipe plan to borrow $150 million from around 12 banks, Ashur has said. (Future Pipe)

Future Pipe Industries Group plans to borrow $150 million from around 12 banks after last month ditching an initial public offering (IPO) at the last minute due to unfavourable market conditions.

The Dubai-based fibreglass pipe maker is looking to refinance old debt and HSBC Holdings and Mashreq are helping the company get the three-year loan, its Chief Financial Officer (CFO) Omar Ashur told newswire Bloomberg on Sunday.

"We've got about $250 million of shorter term loans that we're partially refinancing with medium-term debt,'' Ashur said.

He said Future Pipe was unlikely to return to the debt market before the end of the year.

He also said the cancellation of the IPO would not affect its corporate needs as the money raised was due to be paid to shareholders.

Future Pipe had hoped to raise $554 million through the IPO, selling up to 35% of the company and listing the stock on the Dubai International Financial Exchange (DIFX).

Future Pipe's net profit almost doubled last year to $69 million on a 57% surge in revenue to $556.4 million, Chief Executive Rami Makhzoumi said in March.

In 2006, it controlled 11.6% of the $3.5 billion global market in fibre-glass pipes. In the Gulf, that share was more than 50%, Makhzoumi said.

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