Dubai-based developer Damac has appointed an independent committee of board directors to assess the offer from former chairman Hussain Sajwani to take the company private by buying out the minority shares.
In a filing to Dubai Financial Market, Damac said it has also appointed KPMG Lower Gulf Limited as valuer and Arqaam Capital Limited as financial advisor to evaluate the offer to acquire 100 percent of its issued and paid up ordinary share capital.
Maple Invest Co Limited, an investment vehicle owned by Sajwani, offered AED2.2 billion ($599 million) last week.
Sajwani (pictured below) who owns a 72 percent stake in the developer, resigned as Damac’s chairman to avoid conflict of interest.
Damac said in the filing that he has now been replaced by Farooq Arjomand with immediate effect while Ali Malallah Binjab has been appointed vice-chairman.
Currently Maple has direct and indirect shareholding of 88.106 percent in Damac Properties.
Damac listed in Dubai’s main bourse in 2015 in an exchange for shares that were traded in London since 2013. The company raised about $375 million with its UK IPO.
Sluggish trading, a slump in prices and liquidity, and a desire by companies to escape investor scrutiny have been driving efforts to take public companies private in Dubai.
Emaar Properties said in March it will effectively delist one of its units for about two-thirds of its original public-offering price. Late last year, government-controlled Meraas Holding proposed taking DXB Entertainments private at a 33 percent discount.
S&P Global Ratings said in a research note that the credit metrics of Damac are unlikely to be impacted by its possible delisting.
The agency said the proposed change in financial policy of the residential real estate developer is “credit neutral”.
It added: “We understand that delisting will not have any effect on Damac’s balance sheet, since the consideration will be paid by the acquirer. We also note that Damac cannot distribute dividends due to restrictions under its bond indenture. Therefore, we expect Damac’s credit metrics will be unchanged, in line with the ‘B’ rating and negative outlook.”
Follow us on
