IMD-1-0295 © 2010
Bris, Arturo; Lane, Nancy
This instance is all about the IPO of Air Arabia in 2007 in the United Arab Emirates. Increasing capital in the UAE had begun with Choice 12, issued by the Council of Ministers in 2000; action had grown from 2 IPOs in 2002 to 53 in 2007. A portfolio manager for EFG-Hermes in Dubai, a challenger of the IPO underwriter and book runner, needs to determine the value of an Air Arabia share.
The valuation was complex due to the newness of its illiquidity relative to the USA or UK the UAE stock market and the proven fact that it absolutely was a business with no similar company in the area. Learning objectives: Valuation in of stock prices in illiquid and dubious markets.
Subjects: United Arab Emirates; Middle East
Settings: United Arab Emirates; Middle East ; Airline ; 2006 revenues: AED 749; Operating profit: AED 76; Profit: AED 102; Employees: 464 ; 2007
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