Axiom Telecom has cancelled its initial public offering on the NASDAQ Dubai market because of public concerns.
Axiom cancels IPO, Dubai listing
UAE handset retailer Axiom Telecom has cancelled its initial public offering, citing "market conditions and liquidity" concerns.
In November, Axiom had said it expected to makes its debut on NASDAQ Dubai in early December with a market value of up to $1 billion after selling up to one third of its shares to institutional investors. The IPO was not open to retail investors.
"While there were sufficient orders to fully cover the IPO book at the price range, primarily due to demand from high quality international investors in Europe and the US, there were widespread concerns about market conditions and liquidity," a company statement said.
"The board has therefore decided to withdraw the offer at this juncture to protect current and future shareholders of Axiom," it said, adding that plans to list on NASDAQ Dubai were also cancelled.
In the first IPO in the UAE in nearly two years, Axiom had set a share price range between $0.80 and $1.15 and said it would use $100 million of proceeds from the share sale and a $55 million property sale to pay back part of $354 million in existing credit lines.
"Regardless of valuations or the pricing, we were hoping Axiom's IPO would come to the market and the fact it didn't happen is not a good sign," said Mohammed Yasin, CAPM Investment's chief investment officer.
"For IPOs to succeed they need retail investors to participate - without retail, institutions will not make much money," he said.
This absence also meant banks missed out on profiting from lending to retail investors who could have subscribed to the IPO, Mr Yasin said.
Axiom's CEO said the company would re-evaluate its options later.
"We remain extremely confident in the strengths of Axiom's business, growth prospects and suitability as a public company and will be re-evaluating our options in the future," Faisal Al Bannai said in the statement.