Emirates and Sudan Bank IPO oversubscribed 8 times

DUBAI, June 25 (Reuters) – A $28.5 million initial public offering of Emirates and Sudan Bank (ESB) was oversubscribed eight times, the bank said on Saturday.

The new Islamic bank set up by investors from the United Arab Emirates and Sudan, had offered 28.5 million shares at $1 each, representing 25 percent of the Sudan-based ESB’s paid-up capital. The one-month IPO was launched on May 15.

“This unprecedented success reflects high investor confidence in ESB, which will be the largest capitalised bank in Sudan with … an authorised capital of $200 million,” the bank said in a statement.

The IPO follows completion of the bank’s private placement which closed at $85 million. ESB said large institutions and Islamic banks from both countries have taken part.

Investors in the private placement included Dubai Islamic Bank, Sharjah Islamic Bank , Abu Dhabi Islamic Bank and the Islamic Development Bank, the financial arm of the Organisation of the Islamic Conference.

Sudan’s central bank last year gave approval to ESB, which will be listed in Khartoum.

The bank says mainly Muslim Sudan is poised for an economic upturn after over two decades of civil war which crippled development in the vast country of around 30 million people.

Islamic banks do not pay or charge interest, considered usury by many Muslims. Money is made by using a system of profit-sharing from returns on approved investments.