The Dubai Financial Market (DFM) is reviewing what it considers abnormal share price movements in Arabtec Holding before Aabar Investments said last week it would acquire 70 per cent of the company.
Rumours of the deal helped to send Arabtec's stock more than 30 per cent higher in the two weeks before the planned acquisition was announced.
But shares in the UAE's largest construction company fell 6.9 per cent yesterday amid investor concerns that the company could be hurt by future losses on contracts as a result of the slowdown in the region's building industry.
Aabar announced on Friday that it would buy the Dh6.4 billion (US$1.74bn) stake using a convertible bond at Dh2.3 per share. That is a 20.4 per cent discount to Arabtec's closing price on Thursday.
The deal still needs the backing of 75 per cent of Arabtec's shareholders and approval from government regulators before going through.
As rumours of the acquisition spread near the end of last month, Arabtec said it was "unaware" of the reasons behind its rising stock price.
Aabar issued a statement on January 3 denying the investment. That prompted the Dubai bourse to look into the share dealings.
"It's a normal review of trade and activity in stocks over the last 15 days to see if there are any irregular movements as per the rules of DFM," said a spokesman at the exchange.
Riad Kamal, the chief executive of Arabtec, said "the DFM has to do what it has to do".
"If they uncover anything wrong, then that's perfect for everybody," he added.
Majed Azzam, a property analyst at Al Futtaim HC Securities, said the deal would dilute the value of Arabtec shareholders' stake.
"It is a positive deal in that Abu Dhabi is pumping money into a Dubai company, making sure they stay solvent, while the negative is the dilution to shareholders. But the question now is will Aabar bring enough big projects to the table to compensate for the dilution?"
"The fact that the offer entails a discount - could be seen as an indicator of a larger than previously anticipated hit on Arabtec's Dubai receivables," said Shuaa Capital analysts, who estimated that the Dh2.3 price implied additional impairments for Arabtec of Dh1.7bn.
Arabtec, which has expanded into new markets including Russia, Qatar and Saudi Arabia, has said it would turn its main focus to other locations including Abu Dhabi, where it won contracts last year.
"The size of the funds that Arabtec would receive would be useful to tide through any liquidity concerns that may worsen, which have already affected Arabtec in 2009," said the investment bank EFG-Hermes.
Arabtec will become part of a growing property division within Aabar, which bought two plots in Al Raha district near the Abu Dhabi International Airport in November 2008 for Dh500 million. The company plans to develop up to four residential towers there. It also acquired 12 towers to be developed on six lots on Reem Island in Abu Dhabi for Dh5bn last February, and 14 more plots in Abu Dhabi last year for Dh2.7bn.
The International Petroleum Investment Company, a government energy investment fund, assumed majority ownership of Aabar in March last year.
Aabar also has a major stake in the championship winning Brawn GP Formula One team. The company's stock gained 4.6 per cent yesterday.
* with Reuters
Company Profile
Company name: Hoopla
Date started: March 2023
Founder: Jacqueline Perrottet
Based: Dubai
Number of staff: 10
Investment stage: Pre-seed
Investment required: $500,000
Defined benefit and defined contribution schemes explained
Defined Benefit Plan (DB)
A defined benefit plan is where the benefit is defined by a formula, typically length of service to and salary at date of leaving.
Defined Contribution Plan (DC)
A defined contribution plan is where the benefit depends on the amount of money put into the plan for an employee, and how much investment return is earned on those contributions.
Sarfira
Director: Sudha Kongara Prasad
Starring: Akshay Kumar, Radhika Madan, Paresh Rawal
Rating: 2/5
ROUTE TO TITLE
Round 1: Beat Leolia Jeanjean 6-1, 6-2
Round 2: Beat Naomi Osaka 7-6, 1-6, 7-5
Round 3: Beat Marie Bouzkova 6-4, 6-2
Round 4: Beat Anastasia Potapova 6-0, 6-0
Quarter-final: Beat Marketa Vondrousova 6-0, 6-2
Semi-final: Beat Coco Gauff 6-2, 6-4
Final: Beat Jasmine Paolini 6-2, 6-2
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Opening day UAE Premiership fixtures, Friday, September 22:
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The biog
DOB: March 13, 1987
Place of birth: Jeddah, Saudi Arabia but lived in Virginia in the US and raised in Lebanon
School: ACS in Lebanon
University: BSA in Graphic Design at the American University of Beirut
MSA in Design Entrepreneurship at the School of Visual Arts in New York City
Nationality: Lebanese
Status: Single
Favourite thing to do: I really enjoy cycling, I was a participant in Cycling for Gaza for the second time this year
Scores in brief:
- New Medical Centre 129-5 in 17 overs bt Zayed Cricket Academy 125-6 in 20 overs.
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- Alubond Tigers 138-7 in 20 overs bt United Bank Limited 132-7 in 20 overs
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The biog
Alwyn Stephen says much of his success is a result of taking an educated chance on business decisions.
His advice to anyone starting out in business is to have no fear as life is about taking on challenges.
“If you have the ambition and dream of something, follow that dream, be positive, determined and set goals.
"Nothing and no-one can stop you from succeeding with the right work application, and a little bit of luck along the way.”
Mr Stephen sells his luxury fragrances at selected perfumeries around the UAE, including the House of Niche Boutique in Al Seef.
He relaxes by spending time with his family at home, and enjoying his wife’s India cooking.
Confirmed bouts (more to be added)
Cory Sandhagen v Umar Nurmagomedov
Nick Diaz v Vicente Luque
Michael Chiesa v Tony Ferguson
Deiveson Figueiredo v Marlon Vera
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Tickets for the August 3 Fight Night, held in partnership with the Department of Culture and Tourism Abu Dhabi, went on sale earlier this month, through www.etihadarena.ae and www.ticketmaster.ae.
JAPANESE GRAND PRIX INFO
Schedule (All times UAE)
First practice: Friday, 5-6.30am
Second practice: Friday, 9-10.30am
Third practice: Saturday, 7-8am
Qualifying: Saturday, 10-11am
Race: Sunday, 9am-midday
Race venue: Suzuka International Racing Course
Circuit Length: 5.807km
Number of Laps: 53
Watch live: beIN Sports HD
Race card for Super Saturday
4pm: Al Bastakiya Listed US$250,000 (Dh918,125) (Dirt) 1,900m.
4.35pm: Mahab Al Shimaal Group 3 $200,000 (D) 1,200m.
5.10pm: Nad Al Sheba Conditions $200,000 (Turf) 1,200m.
5.45pm: Burj Nahaar Group 3 $200,000 (D) 1,600m.
6.20pm: Jebel Hatta Group 1 $300,000 (T) 1,800m.
6.55pm: Al Maktoum Challenge Round 3 Group 1 $400,000 (D) 2,000m.
7.30pm: Dubai City of Gold Group 2 $250,000 (T) 2,410m.
COMPANY PROFILE
Name: Xpanceo
Started: 2018
Founders: Roman Axelrod, Valentyn Volkov
Based: Dubai, UAE
Industry: Smart contact lenses, augmented/virtual reality
Funding: $40 million
Investor: Opportunity Venture (Asia)
Company Profile
Name: Direct Debit System
Started: Sept 2017
Based: UAE with a subsidiary in the UK
Industry: FinTech
Funding: Undisclosed
Investors: Elaine Jones
Number of employees: 8
Company profile
Name: Elggo
Started: August 2022
Founders: Luma Makari and Mirna Mneimneh
Based: Dubai, UAE
Sector: Education technology / health technology
Size: Four employees
Investment stage: Pre-seed
RESULT
Bayern Munich 3 Chelsea 2
Bayern: Rafinha (6'), Muller (12', 27')
Chelsea: Alonso (45'+3), Batshuayi (85')
Could We Be More
Artist: Kokoroko
Label: Brownswood Recordings
Rating: 3.5/5
The specs
Engine: Single front-axle electric motor
Power: 218hp
Torque: 330Nm
Transmission: Single-speed automatic
Max touring range: 402km (claimed)
Price: From Dh215,000 (estimate)
On sale: September
Tips to keep your car cool
- Place a sun reflector in your windshield when not driving
- Park in shaded or covered areas
- Add tint to windows
- Wrap your car to change the exterior colour
- Pick light interiors - choose colours such as beige and cream for seats and dashboard furniture
- Avoid leather interiors as these absorb more heat
Company profile
Company name: Fasset
Started: 2019
Founders: Mohammad Raafi Hossain, Daniel Ahmed
Based: Dubai
Sector: FinTech
Initial investment: $2.45 million
Current number of staff: 86
Investment stage: Pre-series B
Investors: Investcorp, Liberty City Ventures, Fatima Gobi Ventures, Primal Capital, Wealthwell Ventures, FHS Capital, VN2 Capital, local family offices
COMPANY PROFILE
Company: Eco Way
Started: December 2023
Founder: Ivan Kroshnyi
Based: Dubai, UAE
Industry: Electric vehicles
Investors: Bootstrapped with undisclosed funding. Looking to raise funds from outside
EMILY IN PARIS: SEASON 3
Created by: Darren Star
Starring: Lily Collins, Philippine Leroy-Beaulieu, Ashley Park
Rating: 2.75/5
The specs: 2018 Maserati GranTurismo/GranCabrio
Price, base Dh485,000 (GranTurismo) and Dh575,000 (GranCabrio)
Engine 4.7L V8
Transmission Six-speed automatic
Power 460hp @ 7,000rpm
Torque 520Nm @ 4,750rpm
Fuel economy, combined 14.3L (GranTurismo) and 14.5L (GranCabrio) / 100km
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COMPANY PROFILE
Company name: Klipit
Started: 2022
Founders: Venkat Reddy, Mohammed Al Bulooki, Bilal Merchant, Asif Ahmed, Ovais Merchant
Based: Dubai, UAE
Industry: Digital receipts, finance, blockchain
Funding: $4 million
Investors: Privately/self-funded