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Thu 5 May 2011 01:22 PM

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Shuaa raises Dubai's DSI on Saudi firm acquisition

Investment bank upgrades construction firm to buy from hold; raises price target to AED1.29 from AED0.93

Shuaa raises Dubai's DSI on Saudi firm acquisition
(Getty Images)

Shuaa Capital upgraded Dubai's Drake & Scull International to
"buy," citing rising backlog and expectations that the company's
acquisition of a Riyadh-based civil construction firm will allow it to grow
further in Saudi Arabia.

Last month, Drake & Scull acquired International Centre for Contracting
Co (ICC), which also has offices in Jeddah and Dammam, for SR128m, in its bid
to expand operations in Saudi Arabia.

"Through the acquisition... DSI has now achieved its primary strategic
objective - to establish a solid execution platform within the kingdom, the
largest construction market in the region," Shuaa said.

It raised DSI's price target to AED1.29 from AED0.93.

Drake, which specialises in mechanical, engineering and plumbing businesses
(MEP), has an effective backlog of AED8.5bn, 88 percent of which is outside
Dubai. Saudi Arabia accounts for 51 percent.

Shares of company were down 0.95 percent at AED1.040 at 0733 GMT on


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