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Mon 20 Oct 2008 10:40 PM

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Bahrain $265mn IPO to go ahead despite crunch

Developer Naseej to seek funds from market in Nov., says business model unchanged.

An IPO to raise 100 million dinars ($265.3 million) for newly set up developer Naseej in the Gulf Arab state of Bahrain will go ahead despite the global financial turmoil, founders of the company said on Monday.

"Our business model has not changed [since the crisis started]. Either you do it now or you forget about it," said Khalid Abdulla-Janahi, chairman of Ithmaar Bank, a Bahrain-based Islamic lender which led the founders.

"We will be the first mover in the market. That's why we're doing it now," Janahi told a meeting of investors.

Gulf Arab bourses have tracked global stock markets downward. The Qatari unit of Vodafone Group last week submitted a revised timetable for its October initial offering after a regulator asked it to delay the launch due to market conditions.

The founders of Naseej include regional banks such as Kuwait's Global Investment House and wealthy individuals.

Abdulla-Janahi said Naseej, which plans to invest 2 billion dinars over the next three years, will have a paid-up capital of 250 million dinars, 100 million dinar of which will be raised through the IPO, which will run from Nov. 18 to Dec. 4.

Abdulla-Janahi shrugged off concerns that the region's five-year property boom could be coming to an end, saying the company will also cater to the low end of the housing market.

"In low-income housing, there is a substantial amount of demand waiting," he said. "We will have business immediately." (Reuters)