We’re All Backing Down From Our IPOs, Except This Fella

Earlier this week we reported that there hadn’t been a major initial public offering of shares in the US for 10 weeks. We’ve been doing a little digging, and it appears that in the UK, there hasn’t been a major IPO for even longer, with the last being the New World Resources’ IPO in May, (which after trading in June at £20.15, is now wallowing at a dismal £2.04). There have been a couple of minor IPOs on the smaller London AIM exchange – LIT raised £65 million on Oct. 2 and ServicePower Technologies £5 million on Sept. 9 – but elsewhere high profile IPO backdowns by Vodafone Qatar and Russia’s Metalloinvest have just been announced. Everyone seems scared senseless…

Except for this guy… as the Gulf Daily News reports on Tuesday:

“Ithmaar Bank chairman Khalid Janahi yesterday shook his fist at fear when he announced the launch of what could be Bahrain’s biggest ever initial public offering (IPO) in the face of the growing global market turmoil.”

Amazingly, this IPO is for a “holistic real estate to construction firm”. You’ve got to be kidding? Housing and construction? Bahrain itself doesn’t seem to be faring too badly at the moment, but as the FT points out:

“The total assets of the 125 [Bahrain] banking institutions – including 64 wholesale banks – is about $265bn compared to its GDP of $11bn, making it impossible for Bahrain to offer a blanket guarantee as the richer UAE has done. Any crunch in Bahrain would “be particularly damaging for sentiment and the kingdom’s credibility as a financial centre”, says a regional banker.”

It’s almost like no one told them the crisis is going on? Khalid Janahi’s response:

“Our business model has not changed [since the crisis started]. Either you do it now or you forget about it.”

Posted by Jonty Rhodes in Hot Money | October 24, 2008 4:53PM |