Du to raise AED1bn from shareholders

UAE-based telecoms operator Du plans to pursue an AED1 billion (USD272 million) rights issue to fund infrastructure improvements, Reuters reports. The move forms part of a larger investment plan for 2010, aimed at ‘transforming the company from a high growth early stage venture to a mature company with efficient management of future funding requirements.’ Du said its government-backed founding shareholders, which together own about 80% of the company, fully support the plan and have agreed to underwrite the rights issue. The operator’s board concluded that an injection of equity would be a proactive first step in achieving an investment grade status and accessing a range of funding sources. Osman Sultan, CEO at Du, said the issue was already fully subscribed by the company’s major shareholders and will meet the financial needs for three to four years, including the expansion and improvement of its 3G network.