Dubai Holding, the conglomerate owned by the emirate’s ruler, received a blow on Wednesday when Emaar Properties blocked a proposed merger with its real estate arms. Emaar’s decision appeared to be a bid to protect itself from the continuing fallout of Dubai’s debt woes.
The company’s board said there was no economic sense in merging with Dubai Holding, whose interests include real estate, leisure and investment holdings. This surprise announcement came from the government, which owns 32 per cent of Emaar.
The move appeared to indicate the government’s intention to separate Dubai’s good assets from troubled vehicles in need of restructuring as the emirate grapples with a debt burden of at least $80bn. Dubai’s stock market fell another 6.4 per cent as Dubai’s debt problems continued to weigh on investor sentiment. Emaar, the market’s bellwether stock, has fallen 38 per cent since Dubai World triggered global panic by asking for a standstill on $26bn in distressed debt.
No comments:
Post a Comment