Dubai Group mulling Shuaa Capital stake sale – report

Stake in financial services firm could be worth $100 million
Dubai Group mulling Shuaa Capital stake sale – report
By Staff writer
Mon 11 Apr 2016 09:44 AM

Dubai Group, a subsidiary of Dubai Holding, is considering the sale of its 49 percent stake in Shuaa Capital, according to a report.

Bloomberg quoted two sources familiar with the matter as saying that the firm had hired Emirates NBD to help find a buyer. The newswire put the value of Dubai Group’s stake in Shuaa at about $100 million.

Between April 2014 and January this year, Shuaa’s stock price had fallen 81 percent.

However, the financial services firm’s share price has risen by 68 percent in year to date, fuelled by speculation that a strategic investor might be buying stock.

In February, Shuaa reported a significant increase in its losses for the fourth quarter, which it attributed to a poor performance from Gulf Finance, its SME lending unit.

The financial services firm’s losses rose to $44 million (AED161.8 million), a steep rise on the $4 million loss recorded in the same period last year. Revenues rose by 58 percent during the quarter to $10.9 million.

For the year as a whole, Shuaa posted a loss of $51.8 million, compared to a $7 million profit in 2014.

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