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Originally published Wednesday, January 6, 2010 at 7:00 AM

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Dubai's port firm seeking stock listing in London

Dubai's port operator said Wednesday it plans to list its shares on the London Stock Exchange, aiming for additional investors as its troubled parent Dubai World struggles to dig out from a pile of debt.

AP Business Writer

DUBAI, United Arab Emirates —

Dubai's port operator said Wednesday it plans to list its shares on the London Stock Exchange, aiming for additional investors as its troubled parent Dubai World struggles to dig out from a pile of debt.

DP World said it could seek the listing as early as the second quarter of 2010. The cargo handler ranks as one of the world's biggest container terminal operators, running the Middle East's largest port in Dubai and 48 other seaports around the world.

The company said the decision follows a review launched last March to "evaluate all available options to address its continued disappointment with the market('s) valuation of the company."

The port operator already lists its shares on the Nasdaq Dubai, one of two stock exchanges in the Arab emirate. Its shares would continue to be traded on that bourse alongside the London listing.

Dubai World, the state-run conglomerate at the center of Dubai's debt problems, retains a stake of about 80 percent in the port company. The rest is publicly traded.

DP World said it would decide whether to issue new publicly traded shares closer to the time of the London listing.

Its parent Dubai World is being restructured and is negotiating with creditors to rework the terms of $26 billion in debt. The conglomerate has said that DP World is not part of that process.

Plans for the new stock listing come two days after DP World announced a decision to push ahead with its stalled London Gateway project, which is slated to become Britain's first new deep-sea container port in more than a quarter century.

That terminal and a number of other port expansion projects were put on hold following a sharp slowdown in global trade that ate into DP World's profits. Questions about the London project's fate resurfaced after Dubai World said it was seeking to freeze some of its debt payments late last year.

DP World said Monday it bought additional land and Royal Dutch Shell's stake in the London project for 136 million pounds ($217.5 million). It said it will go ahead with construction of early "essential infrastructure" at the site, though development plans remain under review.

DP World runs ports on six continents, including several in parts of the developing world that have been less affected by the slump in trade. Like Emirates airline, it is seen as one of Dubai's core state-run companies.

It has struggled to woo investors, however.

"The trading volume was low, the liquidity was limited," said Khaled Akl, head of research at Abu Dhabi Commercial Bank. He said the dual listing has the potential to widen DP World's investor base and boost liquidity.

DP World's stock has fallen 65 percent from its initial price of $1.30 in November, 2007, closing Wednesday at 45 cents a share.

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