The merger between Abu Dhabi’s two biggest state-owned property developers, Aldar Properties and Sorouh Real Estate is now effective, with the combined entity retaining the name of Aldar Properties.
The new entity, which has over Dhs46 billion of combined total assets as of March 31 2013, enjoys a market capitalisation of approximately Dhs16.7 billion based on the closing share prices of both Sorouh and Aldar at the end of trading on June 27, 2013.
Aldar Properties begins trading on the Abu Dhabi Securities Exchange (ADX) on Sunday, following the publication of Ministerial Resolution, which declared the merger effective.
A total of 3,381million new Aldar ordinary shares have been issued to Sorouh shareholders, with the new number of outstanding Aldar ordinary shares following the capital increase standing at 7,862,629,603.
Sorouh has been dissolved and all its assets and liabilities have been transferred to Aldar.
The company also said that it has negotiated an amendment to the terms of the loan facility between Sorouh and a syndicate of banks, which currently has an outstanding balance of Dhs2.1 billion. The interest margin on the loan, taken in June 2010, has been reduced from 4.5 per cent to 2.45 per cent.
Abubaker Seddiq Al Khouri, the new chairman of Aldar Properties, said: “Today marks the first day of business as a combined company. Operating under the name Aldar Properties, the business is one of the biggest real estate developers in the region.
The company benefits from a strong balance sheet, a large asset base, a prime land bank for development and an experienced management team.”
The new combined company has a land bank of 77 million sqm, 90 per cent of which is located in investment zones.
The Abu Dhabi government will remain a key customer for Aldar Properties, the company said.