Tabreed sells assets to fund expansion

EXPANSION PLANS: Tabreed plans to restructure as it prepares to sell some of its assets to finance construction of new utilities. (Getty Images)

UAE-based district cooling company Tabreed said on Sunday it will restructure its operations under plans to sell some of its assets to finance construction of new utilities.

The firm will form a holding company into which existing assets will be transferred, the firm said in a statement on the bourse website.

The UK's Financial Times reported on Friday the firm's board has urged shareholders to approve a plan to sell $817 million of refrigeration plants to finance construction of new units.

Tabreed is considering selling between three and seven plants every year, the paper quoted Deputy Chief Executive Karl Marietta as saying. It is also looking at raising 1 billion dirhams a year through asset sales over the next three years.

The company said in February it planned to raise at least $570 million this year in Islamic loans and convertible bonds to help refinance existing debt and expansion.

Tabreed, which builds cooling and air conditioning systems, said in May it expects to double capacity next year to 1 million tons of refrigeration, with most of the extra capacity added in the UAE.

The company's shares are down almost 23 percent this year to last week's close, underperforming the main index, which has gained almost 9 percent this year.

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