DP World, the Middle East’s biggest port operator, said a private equity investor approached its parent Dubai World about buying a minority stake in the ports company, Bloomberg reported.

Dubai World’s discussions with the private equity company “may or may not result in a transaction regarding a minority stake in DP World,” the Dubai government-owned company said in a statement posted on the Nasdaq Dubai bourse web site. The sale of the stake will come “largely from the free float.”
DP World, the world’s fourth-biggest ports company, operates 49 terminals in 27 countries and has benefited from growing global trade, especially from emerging economies in the Middle East and Asia. 
“Investors are seeing value in port assets around the world and their ability to generate cash flows when world trade rebounds,” Ian Munro, head of research at MAC Capital Advisors told Bloomberg.
Abraaj Capital Ltd, a Dubai-based buyout firm that manages about $6 billion, may buy a minority stake in DP World, Zawya Dow Jones reported, citing government officials it didn’t identify. Abraaj spokesman James Cordahi said the company wouldn’t comment on speculation about its interest.
Other private equity investors in the Middle East include Egyptian buyout firm Citadel Capital SAE and Gulf Capital.
Dubai World raised $4.96 billion in November 2007 by selling a 23 per cent stake in DP World at $1.30 apiece.
There is potential for a sale to a private equity investor “both from free float and Dubai World’s own stake to release cash,” Munro, who estimates the shares may rise to 48 cents, said.
DP World said on March 25 that 2008 net income from continuing operations advanced 30 per cent to $572.3 million. The number of 20-foot containers shipped through the 26 terminals in which it has majority ownership or operational control rose 15 per cent in 2008 to 27.7 million, although volumes fell 8 per cent in the first two months of 2009 amid the global credit crisis.