Wealthy Gulf state keen to divest some high-profile assets, says bourse exec
Al Jazeera, the high-profile Middle Eastern broadcaster,
could launch an initial public offering as early as next year as the Qatar
government looks to offload stakes in state-owned entities, a senior executive
at the country's bourse said.
"Al Jazeera would like to list next year subject to
regulatory approvals and market conditions," said Olivier Gueris, chief
operating officer at Qatar Exchange.
"They [Al Jazeera] have a strong desire to go for an
IPO and list the company at Qatar Exchange. But due to some regulatory
requirements with the Ministry of Business and Trade and the Qatar Central Bank
it may be next year."
Al Jazeera was not immediately available for comment.
The government is keen to divest stakes in a number of state
entities, Gueris said, with Qatar Airways potentially the first high-profile
name to sell some of its capital to the public.
The carrier had hoped to list this year, according to its
chief executive in June, but market volatility has pushed back the timetable.
"They've mentioned Qatar Airways...It will be dictated
by market conditions around the world."
The flow of IPOs on Qatar Exchange has been minimal in
recent years as economic volatility deters firms from going public. Mazaya
Qatar Real Estate Development was the last primary offering in January 2010.
The pipeline could be bolstered by a number of financial
firms based in Qatar's offshore banking free zone, the Qatar Financial Centre,
However, a number of jurisdictional issues between the QFC
and the Qatar Financial Markets Authority, the onshore regulator of Qatar
Exchange, would need to be ironed out before this could happen, he added.
QInvest, Qatar's largest investment bank, is one such QFC
firm which has said it would consider an IPO on Qatar Exchange.
Qatar will launch its secondary bond market next month, with
the latter half of December currently earmarked for the start of trading,
"Local currency sovereign bonds will start listing
after the new year, with treasury bills probably before that," he said.
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A market for local currency debt has been on the cards for a
while and the Qatari government has been issuing riyal-denominated bonds to
banks as part of a plan to provide paper to trade and establish a yield curve
for future issuance.
In January, the Qatar Central Bank issued a QR50bn ($13.7bn)
sovereign bond, following on from a QR12bn offering in 2010.
It has also completed four issues of T-bills so far in 2011,
the latest being a QR4bn offering in August.
Meanwhile, rules governing a stock exchange for small and
medium-sized businesses have been completed and are awaiting the sign-off of
the Qatari regulator, Gueris said.
"It's the regulator's decision so it's hard for me to
say when they will do it but there's strong interest from the highest
authorities in Qatar so the regulator will have to make a decision sooner
rather than later."
A junior market will help businesses access funding and
provide more choice to investors, Qatar Exchange's Deputy Chairman, Ahmed
Mohamed El Sayed, said in May.
Qatar, along with the UAE, will find out next month if it
has been upgraded to emerging market status by index provider MSCI, having had
the decision delayed in June.
Stringent foreign ownership limits in Qatar is one of the
areas of concern for MSCI, and Gueris said there was unlikely to be any change
prior to December's ruling.
However, with its huge cash surplus from liquefied gas
production, an economy expected to grow by 18.9 percent in 2011 and 7.7 percent
in 2012, according to analysts polled by Reuters, and the soccer World Cup in
2022, an MSCI upgrade was not the be-all and end-all for Qatar, Gueris
"Regardless of whether it happens, there will still be
major interest from international investors in Qatar," he said.