x Abu Dhabi, UAESunday 21 January 2018

DP World shares hit two-year peak

DP World shares rose to their highest in two years as the company announced the sale of its Australian unit.

DP World's shares rose to their highest level in two years after the company sold a $1.5 billion stake in its Australian unit to help cut down on debt.

Shares in the Dubai-controlled container terminal operator rose 4.6 per cent to 63 cents on Dubai's second bourse, NASDAQ Dubai. It gives the company a market value of $10.5 billion.

DP World plans to use the proceeds to repay borrowings.

"It shouldn't come as a surprise as they have been mulling an IPO [of the Australian unit] since January," said Shehzad Janab, head of asset management at Daman Investment.

"We knew they had various international parcels and that left the Australian assets.  After the reshuffle, it was either an IPO or a trade sell," he said.

The Dubai Financial Market (DFM) General Index rose 0.3 per cent to 1,630.78 points and the Abu Dhabi Securities Exchange General Index slipped 0.06 per cent to 2,696.79 points.

Energy giant Taqa was one of the top gainers in Abu Dhabi, as it rose 1.4 per cent to Dh1.47. It secured a $3 billion revolving credit facility from 20 international banks, which will be used as part of its expansion plans.

In Dubai, Emaar Properties led the momentum as it rose 0.6 per cent Dh3.51, reversing losses it made yesterday.

Oil futures gained 1.1 per cent to $89.82 a barrel in New York, the highest since October 2008, as signs of US economic recovery buoyed investor speculation that fuel demand will increase in the world's largest oil consumer.

Asian equity markets were also up on the back of rising commodity prices. The MSCI Asia Pacific Index rose 0.1 per cent to 134.94 per cent.