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The landmark US$3.8bn DP World flotation could see the IPO floodgates open in Dubai, and that could generate increased demand for ECM professionals in the region.

Earlier in 2007, Ernst & Young predicted US$18.3bn of IPOs in Dubai this year, but we’re a long way off that right now. Until the DP deal, there were just five ECM deals on the Dubai International Stock Exchange (DIFX) this year, representing a meagre US$1.5bn, according to research from Dealogic.

In this context, the DP World deal could be a much needed milestone that sees Dubai’s ECM bankers go from twiddling their thumbs to fiddling with their Blackberries. It will be the biggest ever flotation in the Middle East – beating the US$2.9bn Saudi Telecommunications Co. share sale in 2002.

Roy Cherry, assistant vice president at Shuaa Capital (which oversaw the Deyaar flotation and is involved with the DP World deal), says: “The region is expected to see increased IPO activity over the coming years, especially if the market conditions continue to be positive. IPO timing is a very important aspect. Regional capital markets saw a severe correction last year – now markets are on the road to recovery.”

Significantly, the DP World IPO is a snub to the major Western exchanges – particularly the LSE – and a chance for Dubai to stake its claim as a major capital markets hub. The firm is a government body, and Cherry predicts other such companies – the Emirates airline and property developer Nakheel, for example – could jump on the privatisation gravy train.

“There are some very large potential transactions in the pipeline. The most sizeable are likely to come out of government portfolios. Potential candidates such as Nakheel are among the largest in the world in their sectors, so these IPOs will be in the global spotlight,” he says.

Big deals could create a need for more seasoned ECM professionals in the Middle East, predicts Cherry: “The process will be more complicated, and this will create demand for additional experience and skill sets.”

Merrill Lynch and Deutsche both have ECM teams in the Middle East and are working on the DP World deal. David Carrier, director at Kinsey Allen, which recruits ECM professionals in the region, says there’s already a shortage of ECM bankers with GCC and UAE-related experience: “A lot of international banks are now running Dubai offices and we are seeing a great demand for ECM professionals.”

An ECM banker with five to seven years' experience can expect to command a base salary of US$120k to US$170k, with a bonus of between 20% and 30%.