 |
|||||
|
|
||||
|
|||||
|
||||||||||||
Emaar to merge with rivals in DubaiBy ugesh sarkar, Section Gurgaon Real Estate Property
The Dubai developer behind the world's tallest building plans to merge with three rivals owned by the sheikdom's ruler, in a consolidation aimed at better coping with a global meltdown fueled weakness in the onetime Arab boomtown's real estate sector.
In a statement posted on Sunday on the Dubai Financial Market's website, Emaar Properties said its proposed merger with Dubai Holding subsidiaries Dubai Properties, Samar Dubai and Tatweer would create a company with an asset base of 194 billion dirhams ($52.8 billion) and a debt of 13.4 billion dirhams, or roughly 7% of the total assets. "The proposed consolidation would create a robust and strategic asset base while joining the strengths" of the various companies, Emaar said. The deal, first outlined Saturday in a release by Emaar, marks a push to shore up a Dubai property market that has seen values plunge by as much as 40% in the first quarter of 2009 as the global economic meltdown hit the sheikdom hard. Layoffs in Dubai's largely expatriate work force compounded the oversupply of units in the semiautonomous city-state, squeezing prices. The tougher financing climate also led to project delays and cancellations, and the fallout from the overall economic weakness further tarnished the image of an emirate whose famed man-made islands, soaring skyscrapers and rampant consumerism helped cast it as a rising global business powerhouse. Source: Economic Times Emaar to merge with rivals in Dubai Click On "Full Story" For More...
As the credit crunch worsened over the second half of 2008, rumors surfaced about Emaar eying a merger with government-run rival Nakheel -- talk that the companies and the government denied. But discussions of consolidations continued, built on expectations that companies would need to adopt some sort of measures -- beyond the bailouts afforded by the Dubai government -- to cope with the difficult business climate.
The companies released few details -- including about valuation -- saying only that the merger process would take roughly four months. The Royal Bank of Scotland and Merrill Lynch were retained as the financial advisers for Emaar and Dubai Holding, respectively. The lack of details introduced a measure of volatility into the market, with Emaar's shares down about 9.6%, to 2.90 dirhams, by midday on Sunday. "The main concern is at what price would this deal come," said Sheriff Abdel-Khalek, account manager with Beltone Financial Services in Dubai. "Would there be more shares, would the (Dubai) government take a bigger stake?" But analysts also saw the move as a strategic for both Emaar and the Dubai property sector. "Such consolidation should help to create stronger entities that are better able to weather any further crises," said a research note released by Mideast investment bank EFG-Hermes. "By consolidating these players with Emaar, it would be easier to facilitate execution of their development pipelines, given Emaar's track record of deliverability, while also providing greater control over the supply of new units." Emaar is perhaps best known for Burj Dubai, the world's tallest building which is still unfinished. The company is also developing the King Abdullah Economic City in Saudi Arabia and is overseeing development of the Kingdom Tower, a kilometer-tall (3,281 foot) building being spearheaded by Kingdom Holding Co., the company headed by Saudi billionaire Prince Alwaleed bin Talal.
Emaar to merge with rivals in Dubai | 0 comments (0 topical, 0 hidden) | Post A Comment
Related Links. website. real estate . web . Emaar to merge with rivals in Dubai . Also by ugesh sarkar |
|
All trademarks and copyrights on this page are owned by their respective companies. Comments are owned by the Poster. The Rest (c) GurgaonSCOOP.com and QBTPL. |
| Home | Ask Questions | Computer Gupshup | Free Member Diaries | Contact Us - Sanjay @ 98 712 19911 |
