Al Jazeera eyeing early 2012 IPO
Dubai, November 26, 2011
Qatar-based broadcaster Al Jazeera could launch an initial public offering as early as next year as the 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,' Olivier Gueris, chief operating officer at Qatar Exchange, told Reuters in an interview on the sidelines of a conference in Dubai.
'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 Center, Gueris said.
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, Gueris said.
'Local currency sovereign bonds will start listing after the new year, with treasury bills probably before that,' he said.
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 50 billion riyals ($13.7 billion) sovereign bond, following on from a 12 billion riyals offering in 2010.
It has also completed four issues of T-bills so far in 2011, the latest being a 4 billion riyals 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 per cent in 2011 and 7.7 per cent 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 believed.
'Regardless of whether it happens, there will still be major interest from international investors in Qatar,' he said.-Reuters