* IPO had been expected by summer this year
* Was expected to mark merger of Abu Dhabi, Dubai indices
* Merger has been delayed as Abu Dhabi reviews commitments
By Stanley Carvalho and David French
ABU DHABI/DUBAI, May 1 Abu Dhabi
government-owned General Holding Corporation (Senaat) has
shelved plans for a stock market debut, four sources aware of
the matter said, as the emirate takes a cautious line on
financial commitments in the wake of its bailout of Dubai.
Despite enjoying significant hydrocarbon wealth, the largest
of the seven United Arab Emirates has been wary of its financial
position since providing Dubai with a $20 billion bailout to
avoid a full economic crisis at the end of the last decade.
That action prompted a widespread review of Abu Dhabi's
economy and financial commitments, a process which has continued
ever since, and while this has yielded institutional benefits -
such as the setting up of a central debt management office - it
has also stymied capital markets activity, such as bond issues
from sovereign and state-linked entities.
Senaat, an investor in Abu Dhabi's industrial sector, had
mandated JP Morgan and HSBC for an initial
public offering (IPO) planned for launch on the Abu Dhabi bourse
by summer this year.
The share sale was expected to help kick-start new listings
after a long drought in the UAE - there hasn't been a major
listing in Abu Dhabi since the market slumped in the wake of the
global financial crisis - and was earmarked to be a high-profile
IPO to mark the merging of the Abu Dhabi index with the Dubai
exchange, which was expected before the end of 2013.
However, with the consolidation yet to take place, the
impetus to list Senaat seems to have waned and it looks set to
be kicked into the long grass by the Abu Dhabi authorities.
"I would like to see it happen but I fear it is going to be
one of those things that gets swept under the carpet by what is
going on in Abu Dhabi," said a source aware of the matter on
Thursday, speaking on condition of anonymity as the information
A second source was more equivocal.
"The plans for the IPO have been called off for now. It
could be launched again once market-related initiatives are
finalised," he said, referring to the stock market merger as
well as moves to establish Global Marketplace Abu Dhabi (GMAD),
the emirate's new financial free zone.
Senaat declined to comment.
In the past, Senaat has listed two of its companies on the
Abu Dhabi bourse: Arkan Building Materials and food
and beverage firm Agthia.
Its largest unit is Emirates Steel, which is in the process
of raising a $1.3 billion loan for expansion.
Senaat's assets totalled 25.4 billion dirhams at the end of
2012 - its latest financial statement.
(Editing by Mark Potter)