By Shane McGinley
Burj Khalifa developer says options outside Amlak equity increase are being mulled
Dubai developer Emaar Properties, the UAE’s largest property developer, has thrown cold water on reports on Wednesday that it is to increase its equity stake in mortgage lender Amlak Finance beyond its current 48 percent, the developer said on Thursday.
“There was an option earlier considered involving the longer term loan of AED230 million by Emaar Properties to Amlak Finance be converted into equity. However, other better and viable options have been identified, which are now being considered and discussed,” Emaar said in a statement to the Dubai Finance Market.
On Wednesday, Mohammed Alabbar, chairman of Emaar Properties, told al Arabiya television that the developer may increase its stake in the mortgage lender.
"I believe if this is part of the solution [for Amlak] we will raise the stake," Alabbar said.
He said currently there are no new companies looking to take a stake in Amlak but added Emaar would welcome other government institutions.
Amlak is currently being reorganised by the UAE government. Amlak and fellow Dubai-based lender Tamweel, once the country’s two largest mortgage providers, stopped lending after the collapse of global credit blocked their access to funds. Shares of the two companies were suspended in November 2008.
Dubai Islamic Bank earlier this year raised its stake in rival mortgage provider Tamweel effectively ending the prospect of a long-awaited Amlak-Tamweel tie up.
A resolution for Amlak could be found during the first quarter of 2011, Mohammed Al Shaibani, deputy chairman of Dubai's supreme fiscal committee said in November.
“The restructuring of Amlak Finance is being managed by a Committee, which is currently considering a number of options in respect of Amlak Finance PJSC and the interests of all the stakeholders
“The management and the Board will ensure that interests of Emaar’s shareholders and stakeholders are considered in acceptance of any option as discussed by the Committee,” the statement added.
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