Emaar merger value destroying, 'distressing'

A merger between Dubai's Emaar Properties and three local firms is likely to be more distressing than supportive due to strategy uncertainty and exposure to the suffering property sector, EFG-Hermes said.

Dubai Holding, owned by the ruler of Dubai, and Emaar said last month the builder of the world's tallest tower would merge with Dubai Properties, Sama Dubai and leisure developer Tatweer.

"While the merger might result in the creation of a stronger operational/financial entity with better access to funding and ultimately greater control over supply, there is no visibility regarding the strategy of the combined entity," EFG-Hermes said in a report.