The Dubai government is planning to raise $1 billion selling shares in road toll company Salik, with the initial public offering (IPO) taking place as soon as next month, according to a Bloomberg report.

Unnamed sources told Bloomberg that Salik had taken out a $1.1 billion loan from Emirates NBD to pay a special dividend to the government, with claims that other IPO candidates in Dubai took out similar loans.

A law was issued last month turning Salik into a public joint stock company, stating that the Dubai Government would retain 60% of capital should an IPO take place.

It was first announced in November last year that the emirate would list 10 state firms to boost the size of the Dubai Financial Market (DFM) to AED 3 trillion.

So far this year, utility giant Dubai Electricity and Water Authority (DEWA), TECOM Group and supermarket chain Union Coop have listed their shares on the local bourse.

(Writing by Imogen Lillywhite; editing by Cleofe Maceda)