Union Properties mulls buyback after shares slump

UNION PROJECT: An artist impression of Union Properties' mega scheme to be built at MotorCity in Dubai. (Supplied)

Dubai's Union Properties said on Tuesday its board was considering a buyback programme after its shares lost over 50 percent of their value this year in a Gulf Arab stock market rout.

"The stock price is a very lucrative price to consider a share buyback programme. We are in discussions with the board of directors," chief financial officer Zaid Ghoul told Reuters.

"The board is still considering it."

Shares in Union Properties, which is also the subject of merger speculation, ended down 6.48 percent on Tuesday.

Regulations in the United Arab Emirates allow companies to buy back up to 10 percent of their shares, once they the approval of the regulator.

Union Properties' announcement comes amid sharp falls in property stocks in Dubai due to ongoing police probes into real estate companies, and the introduction of new rules to better regulate the emirate's booming property market.

Real estate and banking shares have also tumbled across the oil-exporting Gulf Arab region due to concerns that the credit crunch could slow down its booming economies.

Dubai's Emaar Properties, the largest Arab developer by market value, said last month that it would begin to buy back shares in October after securing the approval of the UAE stock market regulator.

In nearby Kuwait, a government task force recommended on Tuesday that firms buy back shares to help shore up flagging shares. (Reuters)

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