The Abu Dhabi Supreme Council for Financial and Economic Affairs has launched a subscription fund valued at 5 billion dirhams to encourage and support private sector companies to list on the Abu Dhabi Securities Market. According to a statement from the Abu Dhabi Government Media Office, the fund will operate under the management of the Department of Economic Development in the emirate.
The fund aims to invest in 5 to 10 private sector companies annually, and will enhance public subscription activities in the Abu Dhabi Securities Market, by motivating companies to list and collaborating with them during the public subscription process. The fund focuses on small and medium-sized enterprises, targeting stakes between 10 to 40% of the total shares available for subscription. It will work with various local banks to leverage their expertise in the company listing process, ensuring that the fund and private sector investors retain the shares for a specified period following the subscription, according to the statement.
Mohammad Ali Al Shorfa Al Hamadi, Chairman of the Department of Economic Development and Chairman of the Abu Dhabi Securities Market, stated that the Abu Dhabi Subscription Fund will contribute to enhancing the attractiveness of the investment environment in Abu Dhabi and stimulate more private sector companies, including small and medium-sized enterprises, to list on the Abu Dhabi Securities Market by providing liquidity and boosting investor confidence in the initial public offering system, thus encouraging private sector investment. He added, "The fund will also encourage the transition from reliance on debt financing to the optimal use of other available financing tools."
