Dubai-based contractor Drake & Scull has said it hopes to reach a mutual agreement to settle a SR200 million ($53.3 million) dispute over the construction of a real estate project in Saudi Arabia.
The construction firm said in a filing to Dubai Financial Market that it was seeking an "amicable resolution" with Lamar Investment and Real Estate over the Lamar Towers project in Jeddah.
It released a statement after Lamar CEO Ahmed Halwani told local media that Drake had failed to complete the commercial and residential towers which were scheduled to be handed over by the end of 2015.
Halwani said Lamar is considering several offers to reassign the project to a local contractor, and the project is expected to be finished in three years, he told Saudi's Okaz newspaper.
The project was initially announced in 2007, but was later restructured and refinanced with Drake & Scull owning a 20 percent direct stake in the project, and 10 percent indirect stake through a partner.
Work reportedly stopped on the project in February, and Halwani claimed up to SR360 million had been injected in the project, but only SR160 million worth of work was completed.
In response, Drake & Scull said Drake said it has been actively engaged with Lamar to arrive at an amicable resolution to settle significant challenges hindering progress on the project.
It added that it has eliminated the project from its backlog and made provisions for it but remains hopeful of a mutual agreement to settle "outstanding issues in a satisfactory and just manner".
Drake & Scull said it remained committed to the Saudi construction market.For all the latest construction news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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