Chasing sky-high valuations, Dubai bankers are turning to the tech sector


Omar Abuinnab, managing director of Keyper, a newly set up real estate technology company in Dubai, poses for a picture, in Dubai, United Arab Emirates, February 3, 2022. Picture taken February 3, 2022. REUTERS/Hadeel Al Sayegh

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DUBAI, Feb 4 (Reuters) – Faced with transaction fees in the Gulf region that are a fraction of those in other markets, many Dubai bankers are postponing their notices, lured by the lure of cashing in , stock options and stock awards in startups.

Veteran investment banker Omar Abuinnab is one of them. He left the Middle East unit of Guggenheim Partners in December to create Keyper, a real estate technology start-up in Dubai.

Launched in January, Keyper describes itself as a private banker to real estate investors. These “proptech” companies are a booming global industry, which secured $2.6 billion in global investment in 2019, up from $1 billion in 2016, according to a 2020 KPMG report.

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Abuinnab is not alone. Former Moelis & Co (MC.N) banker Youssef Salem has joined Dubai-based transport start-up Swvl, which in July announced a merger with US blank check company Queen’s Gambit (GMBT .O). The deal valued Swvl at approximately $1.5 billion.

Amit Agarwal, who was at Goldman Sachs, has joined Middle Eastern logistics and trucking technology firm TruKKer as group chief financial officer.

“In the past, people got into investment banking because it was one of the highest paying jobs. Now they’re trying to build unicorns,” Abuinnab said, referring to companies that are worth $1 billion or more.

Dubai’s technological achievements have sparked more interest in the sector.

Amazon’s acquisition of Middle Eastern online retailer in 2017 for $580 million sparked other deals in the sector, including the acquisition by Uber (UBER.N) for $3.1 billion of carpooling company Careem in 2019.

But for bankers, payment for these transactions can be slim compared to those in other regions.

Saudi Telecom Co’s (7010.SE) technology unit Arabian Internet and Communications Services Co said it would pay $12 million in fees for its initial public offering, according to its September prospectus.

Fees, shared by banks, lawyers and auditors, represent around 1.3% of the value of the transaction, compared to 5% in the United States or Europe.

Saudi Aramco, (2222.SE) whose bid raised a record $29.4 billion in 2019, paid the major banks for the deal $3 million to $4 million each.

Dubai hasn’t had a major IPO since 2017, when Emaar Properties (EMAR.DU) spun off its Emaar Development (EMAARDEV.DU) unit and listed the company on the local stock exchange.

That leaves people like Keyper CEO Abuinnab, 44, looking for other outlets for their ambitions. He then plans to expand the company’s operations to global cities, including London.

“Real estate investors are not well served in this region. I wanted to elevate this experience from my financial background to real estate owners to help them make better investment decisions using real-time data and analytics,” a- he declared.

($1 = 3.6726 UAE dirhams)

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Reporting by Hadeel Al Sayegh. Editing by Gerry Doyle

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