Arabtec CEO Riad Kamal resigns

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Riad Kamal, CEO of Dubai-based construction firm Arabtec.

Riad Kamal, CEO of Dubai-based construction firm Arabtec.

Dubai-based contractor Arabtec replaced its founder and chief executive and is seeking a new finance chief, as part of a boardroom overhaul instigated by its largest shareholder, Abu Dhabi investment fund Aabar.

Arabtec also plans to raise US$1.8bn in new capital through a rights issue and convertible bond, the company said in a statement on Dubai's bourse.

Aabar has been exerting its control on Arabtec since it started building a stake last year. It had already replaced four board members with its candidates and named its chairman, Kadem Abdulla al-Qubaisi, as Arabtec's chairman.

On Wednesday, Arabtec said Chief Executive Riad Kamal resigned and was replaced by Hasan Ismaik, an active Abu Dhabi-based private investor who was made a board member last August.

The company said it is looking to hire a senior management team, including a finance chief and an operations head.

The current chief financial officer for the firm is Ziad Makhzoumi. Arabtec did not say whether he was still working there.

Arabtec, the largest listed contractor in Dubai, has benefited from Aabar's 22 percent holding, winning contracts in the oil-rich emirate of Abu Dhabi including a US$2.9bn contract to build a new airport terminal.

The company plans to raise capital through a rights issue worth AED4.8bn (US$1.31bn) and a convertible bond worth AED1.7bn.

It has previously said it was looking at such an equity-linked fundraising but canceled the plan in March 2011 because of political unrest in the region. Full-year net profit for 2012 fell to AED139.2m from AED221.1m a year ago. The company did not provide quarterly figures.

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Posted by: Nabil

Arabtec is deteriorating over the past few years. Aabar will not do magic to rescue the failure of the company. It's a matter of time.

Posted by: SAM

"It has previously said it was looking at such an equity-linked fundraising but canceled the plan in March 2011 because of political unrest in the region." So in their opinion, March 2013 is much more politically stable than March 2011. It is this kind of logic that makes me wonder what the future holds for this company. What a way to reward a great talent and a giant in the UAE business community.

Posted by: Mathew

AB is bluntly taking over what took 30years to build with sweat, dedication & professionalism. This makes pioneer expat businessmen wonder if this country has a glass ceiling. This is so sad.

Posted by: Roula Bandak

What a shame , the Legend is leaving.

Posted by: Suleyman

I wonder should we take the words above "...has benefited from Aabar's 22 percent holding, winning contracts in the oil-rich emirate of Abu Dhabi ..." as a definitive confirmation that winning public sector contracts in Abu Dhabi is not about meeting the specs at the lowest bid, but about having the right local shareholder/partner ?

It's not that I didn't know that. I just wondered if AB is confirming that publicly....

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