Tamweel, Amlak Said to Weigh Alternatives to Government Merger - Bloomberg.com

Tamweel PJSC and Amlak Finance PJSC, two United Arab Emirates mortgage lenders, may open talks with alternative buyers in case their government-backed merger breaks down, a person with knowledge of the discussions said.

The U.A.E. government has been working for 19 months on a plan to combine the two Islamic finance companies, which relied on wholesale borrowing to fund their lending, since the credit crisis cut off their funding. Dubai property prices have slumped more than 50 percent from their peak in August 2008 as mortgages dried up, according to estimates from Colliers International.

Tamweel and Amlak are drawing up contingency plans should their merger be abandoned, said two people, who declined to be identified because the plans are private. This may include Tamweel and Amlak merging and then combining with a commercial bank, or the two being acquired separately, one of the people said.