The Dubai Financial Services Authority (DFSA) wants the Dubai International Financial Centre (DIFC) to consider establishing the Gulf's first private equity secondary market where holders of non-listed equity can sell or transfer their investments.
In a discussion paper, DFSA Chief Executive Paul Koster says there is an opportunity to create a "trading facility" by which private equity fund managers "can partially sell an investment" from their portfolios.
This would provide the fund manager fresh capital and the new investor a way to join an investment run by a professional fund manager. "As the market for IPOs has dried up, the traditional exit route for a private equity investor too has evaporated," said one investment banker.
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