UAE telecommunications giant Etisalat and du have secured internal approval to increase the ownership limit for foreign investors from 20 percent to 49 percent.
They thus join UAE market heavyweights such as TAQA (Abu Dhabi National Energy Co.) that raised the limit to 49 percent and Emirates NBD to 40 percent.
Non-Gulf nationals currently hold less than 1 percent in du and approximately 5 percent in Etisalat.
“The increase in ownership limits would allow for strategic partnerships and inflows (both passive and active) from key foreign players, especially as Etisalat and du look abroad for increasing revenues and user base. And to capitalize on accessing entry into 5G markets.”
The stocks obtained an immediate boost when the telecom majors unveiled their plans, and this also rubbed off on the broader Abu Dhabi Securities Exchange (ADX) and Dubai Financial Market (DFM) indexes.
Since the beginning of the year, UAE stocks have been among the best performers in the country, and the momentum is ready to pick up further as the vaccination push grows larger and wider.
The companies listed will soon report their results for 2020, and investors will be closely watching whether banks will be able to emerge relatively unharmed from an extremely difficult year. But there are no such concerns about Etisalat and du, and the general impression is they closed out the fourth quarter with another set of upbeat numbers.
Emirates Integrated Telecommunications Company, commercially rebranded as du has agreed that no single person, directly or indirectly, will be permitted to own more than 5 percent of the company’s capital from now on.