Shareholders of Dubai developer Union Properties approve continuity of company

The majority of shareholders in Dubai developer Union Properties have approved a plan for the continuity of the company in carrying out its operations and approved a recovery plan too.

Following an annual general meeting held on April 29, the company said in a filing to the Dubai Financial Market where its shares are traded that the majority shareholders further approved the appointment of Grant Thornton as the company’s auditor for 2022.

The company’s Board of Directors has also been authorized to appoint legal and financial experts, accountants and law firms in order to file and follow up the liability lawsuit against the previous board members who were dismissed at the general assembly meeting held in November last year.

In November of last year, Union Properties confirmed in a stock market disclosure that its chairman Khalifa Al Hammadi’s detention was requested by the UAE’s Federal Public Funds Prosecution. The month prior the UAE attorney general announced a “major” investigation into alleged financial violations at the company. The probe followed complaints by the market regulator, the Securities and Commodities Authority, alleging violations by the company’s board chairman and other officials.

Read: Dubai developer Union Properties’ chairman detained amid probe

The latest turnaround strategy approved at the annual general meeting last month focused on leveraging its existing real estate portfolio and adjacent services subsidiaries with a core focus “on returning to profitability by optimizing its cost base and restructuring its debt” according to a release by the company this week.

Union Properties reported a net loss of Dhs966.76m in 2021, a sharp difference from its net profit of Dhs200.98m reported in the previous year.

“The AGM marks a significant step towards resolving the company’s legacy issues and progressing with the company’s rejuvenation, as shareholders endorse our new turnaround strategy and affirm their support for legal action against the previous board and management,” said Amer Khansaheb, board member and managing director of Union Properties.

“Our strategy focuses on restructuring operation to optimise costs and create a leaner organisation in order to achieve profitability. We are implementing several green initiatives that will enhance resource efficiency and reduce waste across our communities.”

(With inputs from Bloomberg)