Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai, on Tuesday launched the Nasdaq Dubai Growth Market, which aims to help small businesses achieve the next phase of growth.
A new market under the umbrella of Nasdaq Dubai, the initiative aims to help young businesses and small and medium-sized companies (SMEs) by raising capital through an initial public offering (IPO).
Nasdaq Dubai intends to launch the Growth Market in early 2021 in line with the first IPOs. A number of companies have already appointed advisors to begin the IPO process.
The step falls under the framework of the Dubai Future District initiatives, which was launched by Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai.
The Nasdaq Dubai Growth Market will enable fast-growing companies to achieve a listing on the region’s international exchange.
The Growth Market will welcome not only companies in the UAE, but also list companies from around the world to help them expand in the region and internationally.
Sheikh Hamdan (pictured above) said that Dubai is keen to launch initiatives that will boost the economy locally, regionally or globally and stimulate growth across various sectors, while also creating an environment where businesses can prosper through forming partnerships and opportunities.
“SMEs are a key engine of our national economy. The launch of the Nasdaq Dubai Growth Market is a strategic step that will support this vital sector by opening new horizons for its companies and providing them with investment resources to expand their business and enhance their attractiveness in global markets,” he said.
Essa Kazim (pictured below), governor of Dubai International Financial Centre and chairman of Dubai Financial Market, said: “The launch of the Nasdaq Dubai Growth Market will be a milestone for the capital markets of Dubai and the region, by helping to expand the business activity and visibility of companies that choose to list on it wherever in the world they are based.
“The Growth Market is set to play a key role in the future of capital-raising and the channeling of investment to enterprising companies to enable them to succeed during all phases of the business cycle supported by their Dubai listing.”
The Nasdaq Dubai Growth Market allows SMEs to list their businesses if they are valued below $250 million. A minimum operating history of just one year is required, compared to three years for Nasdaq Dubai’s main market.
Nasdaq Dubai is collaborating with government bodies, UAE free zones and expert advisory companies as partners to launch the Growth Market. The advisors will include financial advisory firms, investment banks, law and accounting firms which will provide tailored support including pre-IPO awareness and readiness exercises.
Like Nasdaq Dubai’s main equity market, the Growth Market will allow owners of an enterprise to carry out their IPO while selling as little as 25 percent of the shares in their company, enabling them to keep control.
Companies that are not ready for an IPO will be able to join the Private Market segment of the Growth Market. On the Private Market a company’s shares are held for safekeeping in Nasdaq Dubai’s Central Securities Depository. This is designed to give confidence to investors and moves the company into an exchange environment ahead of a potential listing.
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