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Sun 1 Jun 2008 02:04 PM

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Amlak seeking damages as property deal falls through

Dubai Islamic mortgage lender seeking $22.3mn from First Dubai over Sky Gardens.

Dubai-based Islamic mortgage company Amlak Finance said on Sunday it was seeking 82 million dirhams ($22.33 million) in damages after an initial agreement to buy a tower block in Dubai fell through.

Amlak charged in a statement on the Dubai bourse website that the agreement to buy Sky Gardens for 1.65 billion dirhams collapsed because a unit of Kuwait's Al-Mazaya Holding Company was unable "to honour the terms and conditions stipulated in the MoU".

The unit, First Dubai Real Estate Development Company, subsequently said it was willing go ahead with the sale, despite the lapse of a May 31 deadline. "That is not an absolute deadline and we are willing to proceed," First Dubai said in a statement on the Dubai bourse website.

If the sale falls through, it would keep Amlak's 82 million dirham deposit, it said.

Shares of Amlak were up 4.15% at 0911 GMT. Those of Mazaya and First Dubai were down 1.08% and 1.02% respectively. Arif Al-Harmi, Amlak's chief executive, could not immediately be reached for comment.

Mazaya said this month it will make a profit of 46 million dinars ($173.7 million) from the sale of the project to Amlak through First Dubai. It owns 76.7% of First Dubai. (Reuters)

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