Unicorn mulls private sale instead of IPO

Bahrain's Unicorn Investment Bank could choose to raise about $300 million in a private placement rather than an initial public offering if Gulf bourses fail to shake off their bearish mood, Unicorn's chief executive said on Wednesday.

"We've put a freeze on the IPO for now because of market conditions," Refai said, referring to the Gulf Arab stock market crash of 2006 that saw four of the seven Gulf bourses erase more than 35% of their market capitalisation.

Unicorn, which expects to arrange about $1.6 billion in Islamic bonds this year for Gulf Arab companies, had planned to complete an IPO early in 2007, Majid al-Sayed Bader al-Refai told Reuters in a telephone interview.

"Once the markets start turning around we could do the IPO. But if market recovery is delayed, and we need more money in 2008 we may consider doing a private placement instead," he said.

Bahrain's index, which rose 0.99% in 2006, is this year's third-worst performer after Qatar and Kuwait in the Gulf, down 2.5% to Tuesday's close.

Unicorn has enough free cash to meet its needs this year but still wants to raise about $300 million through the sale of a 20 to 25% stake in the company, possibly in 2008, Refai said. It would list shares in Bahrain, Kuwait and Dubai, he added.

The bank, whose business lines include corporate finance, private equity and asset management, doubled its capital to $233 million in July through a private placement.

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