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Dubai may touch Dh55b mark
BY JAMILA QADIR

10 February 2006

DUBAI — Dubai’s total overseas investments may touch Dh55 billion if the latest DP World bid of Dh25.3 billion for the British port operator Peninsular and Oriental Steam Navigation Company (P&O) is successful, according to industry estimates.

Early last year, DP World, then Dubai Ports International, completed the acquisition of CSX World Terminals (CSXWT), the international terminal business of CSX Corporation, for a closing cash consideration of $1.142 billion.

The company already has extensive operations in the Middle East (Jeddah and the home terminals of Jebel Ali and Port Rashid), Africa (Djibouti), Europe (Constantza, Romania) and India (Visakhapatnam).

Late last year, DP World completed acquisition of green field coastal site at Yarimca, Turkey, for $105 million, and rights to construct new container terminal. It also plans to invest over $170 million in terminal infrastructure.

DP World is considered the largest Dubai overseas investor, with estimated total investments of well over Dh30 billion in various projects around the world.

Dubai Holding, whose combined investment in international projects is estimated at around Dh20 billion, is the second biggest overseas investor.

Last year Dubai International Capital (DIC), the international investment arm of Dubai Holding, announced that it has signed an agreement to acquire UK-based Doncasters Group Limited (“Doncasters”) for £700 million from Royal Bank of Scotland Equity Finance. Completion of the transaction is subject to regulatory approval and is expected this month.

This investment follows a series of strategic, value-driven investments by DIC including a $1 billion investment in DaimlerChrysler, the £800 million acquisition of The Tussauds Group, along with its anchor investments of $272 million in JD Capital investment company in Jordan and $150 million in Ishraq, a company formed to develop and own up to 22 Express by Holiday Inn hotels in the Middle East. Also last year, Dubai International Properties, another subsidiary of Dubai Holding, and the Istanbul Metropolitan Municipality unveiled plans to build a multi-use tower complex in Turkey’s commercial capital Istanbul.

The project, to be called Dubai Towers — Istanbul, costs $500 million, and marks the first project within the $5 billion joint investment venture announced between the two parties.

Earlier this year Dubai Holding’s subsidiary luxury hospitality group Jumeirah International took over the management of the famous Essex House hotel in New York, rebranding it Jumeirah Essex House, following a $500 million buyout by Dubai Investment Group, also a subsidiary of Dubai Holding, from Strategic Hotel Capital in September last year.

The group, which will invest $50 million in refurbishment and rebrand, is also pouring $14 million in its Lowndes Hotel in London for extensive refurbishment programme.

Another fast emerging international investor is Dubai-based Istithmar investment holding company, which has already invested over Dh3.5 billion in various projects around the world.

Last year Istithmar acquired one of New York’s most famous landmark buildings — 230 Park Avenue in Manhattan, also known as the Helmsley Building, a 34-storey gold-domed office block which sits at the top of Park Avenue, in a $705 million deal.

Early last year, the company also purchased a high profile property in London, paying $273 million for One Trafalgar Square, a prestigious office block in the heart of the UK capital.

More recently, Istithmar has bought Inchcape Shipping Services in a deal reported to be worth over Dh1 billion.

Also last month the company along with two wholly owned subsidiaries of Singapore’s Temasek Holdings bought a combined 11.88 per cent of the Bangkok-based Bumrungrad Hospital shares for 2.2 billion baht ($55 million).