DUBAI: United Arab Emirates telecoms services provider raised AED1 billion ($272.3 million) as planned, the company said on Tuesday, to fund a growth plan and compete with market leader Etisalat
Du, owned partly by the ruler of Dubai’s investment company Dubai Holding, and Abu Dhabi investment vehicle Mubadala Development Co., said in April it would pursue a rights issue to fund infrastructure improvements beyond 2010.
Shares were trading 3.6 percent lower at 0647 GMT and are down nearly 20 percent this year although du reported a more than fourfold increase in first quarter profit, driven by subscriber growth.
"The rights issue was a strategic move for du … This additional capital will underpin the next stage of du’s growth," said Chairman Ahmad Bin Byat in a statement posted on the bourse website.
The capital would not be used for acquisitions and the company has no plans for international expansion, chief executive Osman Sultan said in April.
The company plans to increase high-tech services such as its broadband offering and 3G for mobile data but has no intention to build its own core infrastructure such as a fibre-optic network, which it shares with rival Etisalat.