The Al Habtoor Group, a family-owned Dubai conglomerate, plans to raise as much as $1.6 billion through an initial public offering on the Nasdaq Dubai bourse next year, in a move likely to boost moribund equity markets in the region.

The company, whose portfolio spans the hospitality, construction, education and automotive sectors, plans to issue new shares worth 25 percent of its capital as part of the listing, Khalaf Al Habtoor, chairman of the group, told Reuters.

It has hired Grant Thornton as financial adviser for the planned IPO.

The Dubai-based company is one of the UAE's biggest family businesses and a stock market float from the group is seen adding momentum to local equity markets which have struggled to attract new companies since the global financial crisis.

Market volatility and a reluctance among retail investors, burnt by the collapse in stock prices in the crisis, have been cited as factors behind the lack of new public offerings.

The last listing on the Dubai benchmark was Drake & Scull DSI.DU in March 2009, while the Abu Dhabi index has only seen a couple of minor sales since 2008.

The family firm plans to use proceeds from the listing to expand its businesses and acquire properties globally.

"We will use some of the funds for our plans to acquire hotels in London and Paris," Khalaf Al Habtoor, the chairman of Al Habtoor Group told Reuters.

"The funds would be used mainly for our expansion plans. We are also looking to enter into hospitals."

He said the listing is expected to be completed before October next year.

Al Habtoor, which also holds a 27.5 percent stake in a joint-venture construction firm with Australia's Leighton Group (LEI.AX), said they would issue 25 percent additional shares that would help raise between 5 billion to 6 billion dirhams ($1.6 billion).

That would give the company a valuation of $6.4 billion. Developer Emaar Properties EMAR.DU, Dubai's largest listed firm, is valued at $5.5 billion, according to Reuters data.

Its venture with Leighton will not be part of the IPO as the company is a minority shareholder in the partnership.

Al Habtoor is considering simultaneously listing in London and Saudi Arabia, the chairman said.

"We are looking for investors in the region. Nasdaq Dubai needs a strong family company to be with them. We are also looking at London and maybe Saudi Arabia."

Al Habtoor operates in local and international markets, and employ over 40,000 people.

Earlier this year, the firm unveiled plans to develop a new $1.3 billion hotel and entertainment complex in Dubai, despite a property collapse that has seen prices plunge from a 2008 peak.

The group expects revenues to rise 15 percent this year after 10 percent growth between 2010 and 2011.

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