Follow-on market lines up for 4Q reopening

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WHAT WE’RE TRACKING TODAY

THIS MORNING: ADX waves goodbye to Taqa as it delists + Binghatti eyes USD bns worth of partnerships

Good morning, everyone. The backdrop hasn’t changed — the US attacked Iran again overnight, after accusing it of “recent attempted attacks” against commercial shipping in the Strait of Hormuz. But on the ground here, life has largely normalized: schools are back in session, traffic is back to its usual crawl as events shelved back in spring find their footing again, and dealmakers are turning their attention to the fall window.

Follow-on and secondary share sale activity might be picking up heading into 4Q, with analysts expecting large, liquid government-linked names to lead if regional conditions hold steady.

On the debt side of things, we have our first facility from a bank in over a month: DIB closed its debut syndicated Islamic financing facility, drawing 1.6x coverage and opening up a funding channel beyond its usual sukuk issuances.

Elsewhere, Taqa formally exited the ADX after wrapping up its delisting process in the final step in L’imad’s takeover of the utility, and XRG and Masdar each named new heads for their US businesses as both Abu Dhabi firms deepen their US ambitions.

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ADX waves goodbye to Taqa

Abu Dhabi National Energy Company (Taqa) has exited the ADX after wrapping up a delisting process yesterday, the ADX said in a statement (pdf). The cancellation of Taqa’s listing was the final step in the company’s transition after L’imad-owned ADPower’s takeover of more shares in the company triggered a mandatory acquisition process. ADPower moved to buy out remaining minority shareholders after it had already lifted its stake to 98.12%.

The writing was on the wall: L’imad’s squeeze-out of Taqa’s remaining minority shareholders effectively wiped out the company’s public float, leaving little reason to keep it listed.

More to come? Taqa’s ADX exit also offers a preview of what could be in store for AD Ports, after L’imad later moved to take full control of the ports and logistics giant as the sovereign investor consolidates strategically important assets. While L’imad has not publicly given the same rationale for its Taqa acquisition, full ownership gives it considerably more room to maneuver on long-term investment and capital allocation.

Binghatti plans USD bns worth of partnerships

Dubai developer Binghatti is eyeing partnerships and JVs with “very reputable master developers,” Chairman Muhammad Binghatti told Bloomberg. These partnerships could be worth bns of USD and could “perhaps” involve government-related players, he added.

Teaming up with a big name would provide a boost for the developer, which Moody’s recently placed on review for a possible downgrade, citing a deterioration in its liquidity position. Its sukuk has also traded well below pre-war levels. Binghatti, however, insists its finances remain sound, citing AED 10.6 bn in escrow and customer defaults below 1%.

REMEMBER- Earlier in the year, Binghatti said it was shelving its IPO ambitions, later pushing ahead with a USD 500 mn sukuk issuance. It was also flagged as one of the developers whose USD-denominated property bonds entered distressed territory near the start of the war.

Luxair keeps UAE routes grounded

Luxair will keep its Dubai route suspended until 6 February 2027 and has pushed back its planned Abu Dhabi launch from October 2026 to “the end of 2027,” the airline said in a statement cited by the press, citing continued geopolitical tensions in the region and the safety and security conditions required to resume operations. Luxair said it remains confident in both markets' long-term potential and still plans to resume UAE service sometime in 2027.

A turbulent route map: The Luxembourg carrier’s decision comes as renewed volatility ripples across the region. Its timeline now stretches beyond where its peers have landed on the UAE. Air France — after two rounds of delays through the summer — resumed its Dubai route on 26 August. British Airways has suspended Dubai flights until 25 October; Lufthansa and Swiss have Dubai suspended until 13 September; and Cathay Pacific and Singapore Airlines have pushed their Dubai returns to 25 October and 24 October.

PSA

Electronic smoking device liquids are getting pricier as of today: A new minimum excise price of AED 1 per ml for liquids used in electronic smoking devices and tools takes effect today. The change follows a Finance Ministry decision announced last month to bring standards for vaping products more closely in line with other tobacco products. Minimum excise prices already apply to cigarettes, water pipe tobacco, and ready-to-use tobacco products — this extends the same tool to e-liquids for the first time.

IN CONTEXT- The UAE taxes e-smoking liquids at 100% of value. Before today, that 100% was calculated on whatever price a product was declared at. Now, if a product’s declared price falls below AED 1 / ml, the tax is calculated as if it were priced at AED 1 / ml regardless. A liquid declared at AED 0.50 / ml, for instance, used to carry AED 0.50 / ml in tax, but now it carries at least AED 1 / ml — doubling the levy on the cheapest products without any change to the base price. Products already priced above AED 1 / ml see no change; their tax stays at 100% of the declared price.

WEATHER- Abu Dhabi is cooling down a bit today, with a high of 39°C — compared to highs of 45°C all week long — and a low of 32°C. Dubai will land at a high of 42°C, with a low of 32°C.

The big story abroad

The regional war is once again coming to a head, with the US launching a barrage of airstrikes on Iran yesterday, attacking Islamic Revolutionary Guard Corps targets. The strikes — which focused on air defence and radar systems alongside minelaying and communications capabilities — were in retaliation for Tehran’s attempt to lay mines in the Strait of Hormuz, US President Donald Trump said.

Tehran’s response? Iranian parliament speaker Mohammad Bagher Ghalibaf warned that US attacks could lead to a blockade on all oil exports through the critical waterway. Meanwhile, Iran’s military threatened to inflict high costs on US forces in the region.

Bond crisis continues: Global bond markets extended their slide yesterday as worries over inflation and government debt threatened higher borrowing rates for consumers and enterprises. Global bond yields reached multi-decade highs in Japan, the UK, Germany, France, and the US, where the 10-year Treasury yield edged close to 4.8%, a level not seen since January 2025.

In the M&A space: Nestle is looking to sell its mainstream vitamins and supplements unit to US private equity outfit Yellow Wood Partners for USD 1 bn as CEO Philipp Navratil limits the Swiss foodmaker’s strategic scope. The transaction — featuring brands like Nature’s Bounty and Osteo Bi-Flex — continues a series of divestitures, following this year’s sale of half of the firm's water business.

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The UAE's follow-on market is already lining up for a 4Q reopening, even as its IPO pipeline stays frozen

While the UAE has just one live IPO hopeful left this year, its follow-on pipeline is looking promising. Abu Dhabi Islamic Bank (ADIB) last week signed off on a proposal to raise AED 1.75 bn through a rights issue, subject to shareholder and Central Bank of the UAE approval, and Taaleem, the DFM-listed school operator, is weighing a secondary share sale as one of several options available to support its AED 1.5-2 bn expansion plans, CEO Alan Williamson told EnterpriseAM recently. While there’s no clear timeline for that, it’s another sign that capital-raising plans are still very much alive at UAE companies, with follow-ons and secondaries still seen as a viable route.

These moves follow a muted first half of the year, in which the UAE saw just one major follow-on transaction: Sharjah Islamic Bank's USD 701 mn raise through an AED 2.59 bn rights issue. The transaction — the region's largest follow-on issuance in 1H — was backed by Sharjah's government to strengthen capital buffers and support asset growth.

It wasn’t just the UAE — the war put the region’s capital markets on ice. MENA equity issuance fell 71% y-o-y in 1H as the Iran war pushed issuers to reassess plans, while IPO activity also thinned sharply. UAE names have already tapped the brakes, with Dubai Holding reportedly pausing plans to list its retail assets, EGA pushing its IPO to at least next year, and Binghatti shelving IPO plans earlier in the year. Only one IPO might survive: Dubai Investments said in May it remains committed to pursuing an IPO of a 24% stake in Dubai Investments Park before the end of 2026, subject to regulatory approvals and ongoing discussions with banks and investors. The firm had flagged a potential listing in October.

The good news: Analysts expect secondaries and follow-on offerings to pick up in 4Q. Kamco Invest’s director of investment strategy and research, Junaid Ansari, expects to see more secondary offerings if regional conditions improve, especially from state-owned listed companies. His base case is that large, liquid, government-linked names move first, with new listings following only once the outlook stays steady.

The earlier lull looks like delayed activity, not disappearing demand. Ubhar Capital Head of Research Tahir Abbas tells us geopolitical tensions have been the main factor keeping sellers out, while Ansari says shareholders are waiting for valuations to recover and for better visibility on anchor demand before launching. He also points to stretched valuations earlier in the year, weak dividend yields, wider bid-ask spreads, and allocations moving toward US and AI-driven markets.

Why follow-ons and secondaries could move first

They have an execution advantage when markets are jumpy. Secondaries are “far easier to execute in a choppy market than IPOs,” Ansari says, adding that demand for follow-ons could more easily outpace IPOs in the current environment. Accelerated bookbuilds and overnight blocks specifically are likely to lead any reopening because they are quick and carry limited pricing risk.

Why? Because established names have an edge during periods of volatility. Investors in a follow-on can assess an operating track record, visible earnings, liquidity, and a reference price, Abbas says, while new IPOs face greater scrutiny around valuation and post-listing performance.

Abbas also expects a pickup in activity come 4Q, but says the recovery will be “more selective and transaction-specific” after the latest escalation raised the hurdle for sellers. “The distinction is increasingly about valuation rather than IPO versus secondary,” he says. Arqaam Capital Head of Execution and Syndicate for ECM Rawad Kassouf agrees, saying he sees healthy demand for both, but that investors are increasingly focused on “valuation and earnings visibility.”

Kassouf also expects block trades and follow-ons to remain particularly relevant, with larger strategic sell-downs coming where there is a clear underlying rationale.

The strategic sell-down playbook

Secondaries have become one of the more durable stories in UAE capital markets over the past year — and there's a reason they've been so popular. Secondaries in the UAE are becoming less about giving one shareholder an exit and more about increasing freefloat, widening institutional ownership, supporting index eligibility, or recycling capital.

There is already a well-tested playbook for that: UAE follow-on issuance nearly tripled in the first nine months of 2025, with state-linked shareholders driving much of the activity. Mubadala’s AED 3.15 bn du sell-down, for example, lifted the telco’s freefloat to 27.7%, paving the way for its MSCI inclusion last month. It was also the UAE’s first fully marketed secondary share offer — a departure from the accelerated overnight bookbuilds typically used for regional sell-downs.

What 4Q could look like

Don’t expect the floodgates to open. The first transactions are more likely to be quick, targeted transactions in established names than jumbo strategic exits. Larger sell-downs normally come later in a reopening cycle because they can create an overhang and signal that valuations may have peaked, Ansari says. Kassouf expects them to remain concentrated in liquid, benchmark-scale companies where a transaction can materially improve freefloat and institutional ownership.

ADIB’s planned raise, cited above, fits that profile — an established, liquid name with a clear reference price (a 28.8% reduction to its last closing price before the rights issue was announced) — the type of transaction Ansari and Kassouf both expect to lead the reopening.

The bigger test may be how much capital is waiting when everyone comes back. Postponed IPOs, secondary sellers, and other Gulf pipelines could all be chasing investors at roughly the same time. Ansari expects exactly that once conditions improve: “There will be competition for capital in the region.”

Dubai Islamic Bank opens new funding channel with first-ever syndicated Islamic facility

Dubai Islamic Bank (DIB) closed its debut syndicated Islamic financing facility — a USD 750 mn, three-year senior unsecured commodity murabaha term loan that pulled in c. USD 1.2 bn in commitments, or about 1.6x the facility size, DIB said in a statement (pdf). This follows a USD 1 bn AT1 sukuk issuance in June. Pricing on the facility wasn’t disclosed.

Why it matters: Syndicated loans draw a different investor base than public sukuk (attracting direct bank lending rather than bond investors), and opening that channel gives DIB more room to diversify away from capital markets pricing when it needs liquidity. The 1.6x coverage — while less frenzied than the 2.3x order book DIB generated for its AT1 sukuk in June — signals resilient demand for the first bank debt issuance in over a month.

ADVISORS- HSBC Bank Middle East, Mizuho Bank, and Standard Chartered acted as initial mandated lead arrangers, bookrunners, and coordinators. That trio was named when the facility was first mandated in mid-June.

Philip Haddad moves up to lead XRG Americas as Masdar hands its US platform to Khaleefa Al Mheiri

Khaleefa Al Mheiri (LinkedIn), Masdar’s acting chief operating officer, will become president and CEO of Masdar Americas, effective 19 October, according to a LinkedIn post. He replaces Philip Haddad, who moved to lead XRG’s Americas business. Haddad stays linked to Masdar through a board seat at Terra-Gen, the US renewables platform Masdar took a 50% stake in 2024.

Why it matters: Both Abu Dhabi firms have big US ambitions, though XRG’s mandate is a little more diversified than Masdar’s renewables-only focus. Masdar plans to develop a portfolio of up to 25 GW in the US within the next decade. It already has a 1.1 GW pipeline of renewables projects with EDF Power Solutions, along with projects across the US and a 4.2 GW portfolio of projects at Terra-Gen. Meanwhile, the Americas business of XRG — Adnoc’s global energy and industrial investment arm — includes an equity stake across all five Rio Grande LNG trains in Texas, a 32% stake in Argentina’s Vaca Muerta basin, and — as of last month — an equal-interest stake in Venezuela’s offshore Loran gas field alongside BP and Qatar’s UCC Oil and Gas.

BACKGROUND- Al Mheiri joined Masdar as director of portfolio management in August 2023 before moving to the acting COO role. He spent close to two decades before that across Adnoc — including as acting CEO of Ta’ziz and senior VP of its oil and chemicals business — the Abu Dhabi Department of Economic Development, and Borouge.

Saudi’s Humain backs Arabic.Ai

Saudi AI money heads to Arabic.AI

Saudi PIF-backed Humain made an undisclosed strategic investment in UAE-based Arabic.AI to scale Arabic and multilingual enterprise AI, according to a press release. The partnership will pair Humain’s AI infrastructure and models with Arabic.AI and Tarjama’s language technology, initially targeting translation, archive digitization, and document-intelligence tools for Saudi enterprise customers.

GCC equity markets rebound even as outlook appears murky

GCC equity markets posted their strongest monthly performance in seven months in August, with the MSCI GCC index up 3.9% — breaking a three-month losing streak as regional geopolitical tensions eased, according to Kamco Invest’s monthly report (pdf). The rally tracked a broader global rebound: the MSCI World Index gained 2.6% on a healthy earnings season.

Saudi Arabia led regional gains with a 5.1% rise — its best month since January — followed by Oman (+4.5%) and Kuwait (+1.6%). Abu Dhabi added 0.9% and Dubai 0.7%, while Qatar (-1.1%) and Bahrain (-1.0%) were the only markets to close the month lower.

The rally was broad-based across sectors, led by hotels and leisure (+10%), materials (+8.2%), and ins. (+7.5%). Telecom rose 5.0% and banking 4.7% — the region’s most heavily weighted sectors. One outlier: energy stocks, despite elevated and volatile oil prices tied to the closure of the Strait of Hormuz, gained just 1.2% — the weakest of any sector.

YTD, the picture is more mixed — and it’s Oman, not Saudi Arabia, that leads the region. The MSX 30 is up 29.6% YTD, by far the GCC’s best performer, built on outsized gains of 7.9% in January and 16.8% in February. Saudi Arabia (+6.1%) and Abu Dhabi (+0.1%) are the only other markets in positive territory for the year, while Qatar (-8.9%), Bahrain (-6.3%), and Dubai (-3.5%) remain the laggards.

The outlook has since grown murkier. Kamco’s report notes that global bond yields already hit their highest level since 2008 by the end of August as Fed comments raised the odds of a September rate hike. That selloff has deepened further: Japan’s benchmark yield hit 3% for the first time since 1996, and Australia’s 10-year touched its highest since 2011, after renewed US-Israeli strikes on Iran pushed Brent crude above USD 91/bbl. JPMorgan’s Tai Hui says the risk for the region runs through energy prices directly — a prolonged regional stalemate, paired with depleted inventories and rising winter fuel demand, points to further upside pressure on global headline inflation.

MARKETS THIS MORNING-

Asian markets tumbled at the open today, as Japan’s Nikkei and South Korea’s Kospi each dropped roughly 2.4%. The slide mirrors Wall Street’s overnight decline, driven by escalating regional conflict and a worsening government bond crisis.

ADX	9,974	-0.3% (YTD: -0.2%)
DFM	5,834	-0.0% (YTD: -3.5%)
Nasdaq Dubai UAE20	4,779	-0.4% (YTD: -2.2%)
USD : AED CBUAE	Buy 3.67	Sell 3.67
EIBOR	3.5% o/n	4.4% 1 yr
TASI	11,101	-0.2% (YTD: +5.8%)
EGX30	55,431	+1.0% (YTD: +32.5%)
S&P 500	7,631	-0.7% (YTD: +11.5%)
FTSE 100	10,789	-0.3% (YTD: +8.6%)
Euro Stoxx 50	6,369	-0.8% (YTD: +9.9%)
Brent crude	USD 94.65	+4.6%
Natural gas (Nymex)	USD 2.95	+1.6%
Gold	USD 4,375	-0.5%
BTC	USD 77,268	-2.1% (YTD: -11.8%)
Lunate JP Morgan UAE Bond UCITS ETF	AED 3.63	+1.1% (YTD: -4.0%)
S&P MENA Bond & Sukuk	150.97	-0.2% (YTD: -0.6%)
VIX (Volatility Index)	16.34	+9.5% (YTD: +9.3%)

THE CLOSING BELL-

The ADX fell 0.3% yesterday on turnover of AED 1.2 bn. The index is down 0.2% YTD.

In the green: Abu Dhabi National Co. for Building Materials (+14.5%), Eshraq Investments (+11.0%), and Al Khaleej Investmet (+10.3%).

In the red: Oman & Emirates Investment Holding Co (-4.9%), Ins. House (-4.4%), and Union Ins. Company (-3.8%).

Over on the DFM, the index remained flat on turnover of AED 650.1 mn. Meanwhile, Nasdaq Dubai was down 0.4%.

CALENDAR

1-3 September (Tuesday-Thursday): Middle East Energy, Dubai World Trade Center, Dubai.

7-9 September (Monday-Wednesday): AIM Congress, Dubai World Trade Center.

7-9 September (Monday-Wednesday): International Property Show, Dubai World Trade Center, Dubai.

12-13 September (Saturday-Sunday): Emirates International Congress on AI & Visionary Leadership in Transforming Healthcare, Adnec Center Abu Dhabi.

14-17 September (Monday-Thursday): Arabian Travel Market, Dubai World Trade Center, Dubai.

15-16 September (Tuesday-Wednesday): Federal Open Market Committee (FOMC) meeting.

17-19 September (Thursday-Saturday): International Real Estate & Investment Show (IREIS), Adnec, Abu Dhabi.

18-19 September (Friday-Saturday): EuroLeague Basketball SuperCup, Etihad Arena, Yas Island, Abu Dhabi.

28-29 September (Monday-Tuesday): Al Ain Future Business Forum, Adnec, Al Ain, Abu Dhabi.

29-30 September (Tuesday-Wednesday): AFCM Annual Conference, Abu Dhabi.

OCTOBER

1-2 October (Thursday-Friday): MEIRA Annual Conference, Atlantis the Royal, Dubai.

4-10 October (Sunday-Saturday): World Space Week, Abu Dhabi.

5-7 October (Monday-Wednesday): AI Everything Global, Adnec Center, Abu Dhabi.

12-14 October (Monday-Wednesday): Airport Show, Dubai World Trade Center, Dubai.

14-15 October (Wednesday-Thursday): Sharjah Investment Forum, Jawaher Reception and Convention Center, Sharjah.

13-15 October (Tuesday-Thursday): Annual Meeting of Global Future Leaders, Dubai.

20-22 October (Tuesday-Thursday): Future Health Summit, Adnec Center Abu Dhabi.

21 October (Wednesday): Reuters NEXT Gulf, St. Regis Saadiyat Island Resort, Abu Dhabi.

27-28 October (Tuesday-Wednesday): Arab Competition Forum, Dubai.

27-28 October (Tuesday-Wednesday): Federal Open Market Committee (FOMC) meeting.

30 October (Friday): Large businesses achieving annual revenues equal to or above AED 50 mn must appoint an accredited service provider for e-invoicing implementation.

Signposted to happen sometime in October 2026:

Abu Dhabi Space Week, Abu Dhabi.

NOVEMBER

2-6 November (Monday-Friday): Dubai Future Finance Week, Dubai.

4 November (Wednesday): Digital Transformation Summit, Sofitel, Abu Dhabi.

9-10 November (Monday-Tuesday): Annual government meetings, Abu Dhabi.

9-12 November (Monday-Thursday): EMEA Council on Hotel, Restaurant and Institutional Education Conference, Dubai College of Tourism, Dubai.

9-13 November (Monday-Friday): World Congress of Military Medicine, Adnec Center, Abu Dhabi.

10-12 November (Tuesday-Thursday): Dubai International Electric Vehicle Exhibition & Conference, Dubai World Trade Center.

16-18 November (Monday-Wednesday): World Police Summit, Dubai World Trade Center, Dubai.

18-19 November (Wednesday-Thursday): Touchdown Middle East 2026, Conrad Abu Dhabi Etihad Towers, Abu Dhabi.

25-26 November (Saturday-Sunday): Doers Summit, Dubai Silicon Oasis, Dubai.

DECEMBER

2-4 December (Wednesday-Friday): UN Water Conference, UAE.

4-6 December (Friday-Sunday): Formula 1 Abu Dhabi Grand Prix, Abu Dhabi.

8-9 December (Tuesday-Wednesday): Capital Market Summit, Madinat Jumeirah, Dubai.

8-9 December (Tuesday-Wednesday): Federal Open Market Committee (FOMC) meeting.

7-10 December (Monday-Thursday): Abu Dhabi Finance Week, Al Maryah Island, Abu Dhabi.

8-10 December (Tuesday-Thursday): Abu Dhabi Water & Power Week, Adnec Center, Abu Dhabi.

8-10 December (Tuesday-Thursday) Middle East & North Africa Business Aviation Association Show, DWC, Dubai Airshow Site.

Signposted to happen sometime in 2027:

1 January: Deadline for large businesses to implement e-invoicing;
1Q 2027: Completion of the first phase of Hassyan seawater desalination project;
1-3 February (Monday-Wednesday): World Governments Summit;
31 March: Small businesses with annual revenues of less than AED 50 mn are obliged to contract with an accredited service provider for e-invoicing implementation;
31 March: Government entities are required to appoint an accredited service provider for e-invoicing implementation;
21-22 April (Wednesday-Thursday): Token2049, Dubai;
1 July: Deadline for small businesses to implement e-invoicing;
1 October: Deadline for governments to implement e-invoicing;
Abu Dhabi’s solar and battery energy facility, combining 5.2 GW of solar capacity and 19 GWh of battery storage, is set for commissioning.

Signposted to happen sometime in 2028:

Artificial Intelligence Summit.

Signposted to happen sometime in 2029:

Sibos 2029 organized by the Society for Worldwide Interbank Financial Telecommunication (SWIFT), Dubai;
Annual Meetings of the World Bank Group and the International Monetary Fund, Abu Dhabi;
The commissioning of the seventh phase of Mohammed bin Rashid Al Maktoum Solar Park.

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