Meydan Group and Arabtec Construction have announced that they have reached agreement to hold amicable discussions towards reaching a deal on a long-running multi-billion dirham dispute.
The two Dubai-based companies said in a joint statement that they were seeking to reach an out-of-court resolution of all outstanding claims and counter-claims involving the construction of facilities at the Meydan racecourse.
Arbitration proceedings were initiated over four years ago following claims and counter-claims regarding payments between Meydan and the 50-50 Arabtec-WCT joint venture.
Meydan will also host similar discussions with WCT Berhad, a statement said.
Dubai-based Arabtec and Malaysia’s WCT were appointed to build the racecourse and surrounding buildings in September 2007.
The contract was subsequently cancelled in early 2009 and Arabtec and WCT jointly launched a AED2.8bn ($762m) claim against Meydan “for breach of contract and to enforce the JV’s rights and remedies, including the recovery of all amounts due under the contract as well as damages”.
Meydan Group, the Dubai developer behind the world’s biggest horse-racing complex, launched a AED3.5bn counterclaim.
The statement added: "Meydan and Arabtec have agreed, without prejudice to their respective rights and obligations, to withdraw their case from the arbitration process administered by Dubai International Arbitration Centre (DIAC).
"The arbitration process has been halted with no order as to costs. Talks are expected to commence shortly."
The Arabtec-WCT joint venture was awarded a contract in September 2007 for the construction of the main building, external and infrastructure works of the Meydan racecourse.
Saeed Humaid Al Tayer. chairman and CEO of Meydan, and Hasan Abdulla Ismaik, Arabtec managing director, said: "We are determined to reach an amicable agreement over all the outstanding claims and counter-claims.
"Four years of legal proceedings have failed to make sufficient progress so we have decided to find a faster and more practicable way forward to resolve matters."
They added: "This is a very welcome initiative and we remain optimistic, confident and committed to reaching an amicable out-of-court settlement."
The Meydan Racecourse, which includes a five-star hotel, two race tracks and a grandstand, was officially opened in March 2010 and is home to the Dubai World Cup, the world’s most expensive horse race.