A DP World Stake Sale Could Help Signal Bottom For PE

Dubai World subsidiary Dubai Ports is reportedly in talks with Middle Eastern private equity (PE) firm Abraaj Capital over the sale of a minority stake, in a move that would come as a welcome relief after two quarters that have seen precious little buyout activity in the region. In a statement, DP World said only that it 'has been informed by its ultimate majority shareholder Dubai World that [it] has received an approach from, and is engaged in discussions with, a regional private equity firm which may or may not result in a transaction.' Abraaj, which already owns a stake in budget airline Air Arabia, has previously said that it is planning US$2bn worth of deals this year across the MENA region and Asia in a bid to pick up undervalued assets. It closed its latest buyout fund in September with US$2.6bn, and has been waiting to deploy some of this dry powder once prices bottomed. It has not been the only buyout firm holding out, with data from Dealogic showing that the Middle East region has seen just 3 PE buyouts this year, worth US$500mn.

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