(Bloomberg) --

Dubai is seeking to raise about $1 billion by selling shares in the city’s road-toll collection system as soon as next month, people familiar with the matter said. 

Ahead of the share sale, Salik has taken out a $1.1 billion loan from Emirates NBD Bank PJSC to pay a special dividend to the government, the people said, asking not to be identified as the information isn’t public. 

Emirates NBD will invite other lenders to participate in the loan, they said. Other Dubai IPO candidates have taken out similar loans, two of the people said. 

Salik is continuing to target September for its share sale despite a recent dip in investor appetite, the people said. It wasn’t immediately clear how many shares will be offered, but Dubai’s government has previously said it will retain a minimum 60% stake.

Details of the offering such as timing and size are not final and subject to change, the people said. Emirates NBD declined to comment, while representatives for Salik weren’t immediately available for comment. 

Salik, Arabic for open, is an automated system introduced in 2007. Each time a vehicle passes through one of the city’s eight toll points, 4 dirhams ($1.09) are charged to a prepaid account, eliminating the need for cash or toll booths. 

Proforma revenue at the firm rose 22% to 1.69 billion dirhams in 2021, the company told investors in a pre-IPO meeting. Proforma Ebitda jumped by more than a third to 1.5 billion dirhams.

The Gulf region was a bright spot for IPOs during the first half of the year, in contrast to subdued levels of activity elsewhere, but there have been a handful of lackluster trading debuts in recent months. Dubai’s last two listings -- supermarket operator Union Coop and property firm Tecom Group -- both slumped on debut. 

Salik is one of 10 proposed privatizations in Dubai as part of the city’s plans to bolster its capital markets. Emirates Central Cooling Systems Corp. is also working on an IPO, Bloomberg News has previously reported. 

Bank of America Corp., Emirates NBD and Goldman Sachs Group Inc. are arranging the local stock exchange listing alongside Moelis & Co., the financial adviser for the IPO, Bloomberg News has reported. 

(Updates with Emirates NBD comment in fifth paragraph)

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