Saturday, December 12, 2009

Emaar and Dubai Holding back off merger plans

Emaar Properties, and Dubai Holding, announced that they have called off merger plans, which was planned few months ago.

The joint statement said that the decision is based on findings through feasibility studies prepared by renowned economists and analysts under the supervision of company officials.

The statement mentioned that studies showed that the merger initiative is not 'economically viable for now'. The move comes few months after Dubai Holding mentioned that it was restructuring its companies into four verticals, by preparing its real estate entities for a possible merger.

The merger was planned for October this year, according to Dubai Government's announcement in June. According to Analysts, Emaar has taken steps to retain shareholder value and move ahead with its own projects.

Emaar and Dubai Holding had been engaged in detailed evaluation on viability of the proposed consolidation of their activities, including assessment of various portfolios and proposed structure for transaction. The regulatory authorities were also consulted during the talks.
This initiative indicates that Emaar aims to face the current economic downturn in its own terms and is seeking to retain its shareholder value, said Sudhir Kumar, Managing Director, Realtor's International, a property consultancy.

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