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Dubai to set up new investment fund

The Dubai Investment Fund will replace the Dubai government as owner of shares in companies IMAGO/Jürgen Schwenkenbecher via Reuters
The Dubai Investment Fund will replace the Dubai government as owner of shares in companies

Dubai will set up a new investment fund to bolster the emirate’s financial stability and manage its stakes in some public service entities.

Dubai Ruler Sheikh Mohammed bin Rashid Al Maktoum issued a law to set up the Dubai Investment Fund, which will be chaired by UAE finance minister and deputy ruler of Dubai Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, the UAE state-run Wam news agency reported.

Abdulaziz Mohammed Al Mulla was appointed managing director and CEO of the fund.

The new fund will be an independent public entity operating commercially. It will hold the Dubai government’s shares in Dubai Electricity and Water Authority (Dewa), toll-road operator Salik Company and Dubai Taxi Company.

Dubai Investment Fund will replace the Dubai government as owner of shares in companies, taking over all contracts, agreements, commitments, deposits, bank accounts and loans associated with such shares.

The fund will aim to generate returns for the emirate’s current and future generations and take on responsibility for investing government funds, surpluses and the general reserve locally and internationally.

In addition, it seeks to bolster the financial stability of the Dubai government by financing its deficit and establishing strong financial reserves, thus promoting long-term financial sustainability.

The Dubai government has a privatisation plan to list 10 state-linked companies to boost stock market activity, Reuters reported.

The government has raised nearly $8.5 billion from five initial public offerings last year, with the latest listing being Dubai Taxi.

Dubai Taxi in November said the order book for its AED1.2 billion ($323 million) initial public offering swelled to over AED150 billion ($41 billion), as it was covered 130 times.

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