Emaar bid to calm shareholders

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Emaar chairman Mohamed Ali Alabbar said the company has confidence in its self.

Emaar chairman Mohamed Ali Alabbar has released a statement in a bid to calm shareholders following 12 months of diminishing value for the developer's listing on the Dubai Financial Market.

The statement is intended to put a positive spin on the current global financial situation, which has contributed to the fall in Emaar share value, particularly due to sliding real estate demand.

Alabbar said that Emaar "will start a new chapter in its growth story in 2009 by evolving strategies to face the challenges posed by the global financial crisis and exploring new opportunities."

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While accepting that 2009 would see several challenges arise in the property sector, Alabbar said, "Emaar will face these challenges with confidence and we will focus our energies to adapt to the changing circumstances.

Our strategy of business segmentation and geographic expansion has proven its effectiveness, and we will continue along this path."

The firm currently has operations in a number of locations, including Egypt and Saudi Arabia, and was the first Middle Eastern developer to open an office in China.

Emaar's share price has fallen around 80% since January 2008, from US $4.10 (AED15.00) to below $0.80.

Shares were trading at an all time high of $11.28 in June 2005, representing a fall of 93% in 42 months to current stock value.

A fortnight ago the deadline for Emaar's share buyback scheme was reached, triggering a further slide in its trading value.

According to the Securities and Commodities Authority, the developer bought back only 200,000 shares, or 0.003% of its capital, despite applying to buyback up to 10% of its shares.

Emaar issued a statement in defence of its actions, which said, "Emaar exercised its right to buyback a limited number of shares as part of this programme. This was carried out in line with global best practice and was followed by timely disclosure of the same.

"Emaar's activities related to the share buyback programme were carried out in the best interest of the company and its investors, and in line with current global financial conditions."