Sunday, September 10, 2006

Emaar Economic City to triple its Red Sea project

Saudi property developer Emaar Economic City plans to triple the area of its $26.7 billion (Dh97.9bn) real estate project on the Red Sea coast, the company said yesterday. The property developer’s shares closed at Dh33.50, up 9.84 per cent, the largest gainer on the Saudi Tadawul index.

A meeting of the board will be held on Tuesday to discuss the expansion at King Abdullah Economic City, a statement on the website of the Saudi stock exchange said.

The area under development will increase to 168 million sq m, the statement said, describing the project expansion as an increase of “around four times its current size”.

The project area was 55 million sq m, according to information previously released by Emaar Economic City. The reason for the discrepancy was not clear.

“The company has had all the required official approvals to expand the area of the project to neighbouring land,” the statement said.

King Abdullah Economic City is the single largest private investment ever made in the world’s top oil exporter. Dubai’s Emaar Properties, the largest listed Arab property developer, is a major shareholder in Emaar Economic City, which is spearheading the project.

Shares in Emaar Economic City, debuted on the Saudi bourse on Saturday and closed at more than three times its listing price.

Emaar City sold shares at 10 riyals (Dh9.7) each in a $680 million (Dh2.4bn) initial public offering in August that was 182 per cent oversubscribed. The $680 million (Dh2.4bn) IPO, the kingdom’s largest this year, was closely watched around the Gulf as the first major test of investor appetite after the crash of the stock markets between February to May.

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