DUBAI (AFP) - Gulf budget carrier Air Arabia said on Monday it will launch a 698-million-dollar initial public offering (IPO) representing 55 percent of the Sharjah government-owned airline.
The March 18 IPO will be "the largest offering in UAE history and will be open to both UAE citizens and non-UAE nationals," said a statement by the first low-cost Middle East carrier.
Over a 10-day period, investors will be able to acquire shares with a total value of 2.566 billion dirhams (698 million dollars) which will later be listed on the Dubai financial market.
The no-frills airline was founded in 2003 and operates a fleet of nine aircraft. It plans to use the proceeds of the offering to expand its fleet to at least 34 aircraft by 2016, it said.
"Air Arabia's strategic objective is to be one of the leading airline companies in the region," said its chairman Sheikh Abdullah bin Mohammad Al-Thani.
It is the first Middle East airline to go public, said Makram Kubeisy, managing director of SHUAA Capital's Investment Banking, which is the IPO's lead manager.
The carrier, which operates from Sharjah's relatively small airport a few kilometres (miles) from the Middle East's busiest airport in neighbouring Dubai, has managed to secure a handsome share of the aviation market.
Air Arabia's revenue increased to 749 million dirhams (204 million dollars) in 2006, compared to 411 million dirhams (112 million dollars) in 2005, posting a net profit of 101 million dirhams (27.5 million dollars), said Karim Schoeib of SHUAA Capital in the statement.
In 2006 the airline flew 3.3 million passengers to 35 destinations.
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