Monday, May 14, 2012

--Arabtec says Aabar units hold in total a 20.76% stake in company as of May 10

--Market concerned that a majority stake could lead to delisting, overlook minority interest

(Adds trader comments, background throughout, latest stock price.)

By Nikhil Lohade

Of ZAWYA DOW JONES

DUBAI (Zawya Dow Jones)--Aabar Investments holds a 20.76% stake in Arabtec Holding, further consolidating its influence over the Dubai-based company.

Arabtec, in a statement posted on the Dubai bourse website Monday, said Aabar and its units totally held a 20.76% stake in the company as on May 10, denying recent media reports that the Abu Dhabi-based firm owned a 53% stake in the construction firm.

Arabtec earlier this month named Aabar Chairman Kadem Abdulla Kadem Butti Al Qubaisi as its new chairman, triggering market speculation that the Abu Dhabi company held a much bigger stake in Arabtec than earlier disclosed.

The stock fell some 19% in the last 11 sessions amid concerns that Aabar taking a majority stake in the company may lead to Arabtec shares being delisted, overlooking minority shareholder interests.

Another worry, traders say, was that if Aabar had already increased its stake substantially, there wasn't much upside left for the stock.

Arabtec shares have rallied in the past few months, boosted by market speculation earlier in the year that a strategic investor was building a stake in the company. The stock is up some 83% so far this year.

Aabar had scrapped a deal in 2010 to take a majority stake in Arabtec, but its renewed interest in Arabtec has also cheered some investors who reckon that this will only strengthen the Dubai firm and also boost its chances to get more business in the U.A.E. capital.

Aabar Real Estate holds a 5.18% stake in Arabtec, while Aabar Petroleum Investments Co. owns a 5.32% stake, according to previous Dubai bourse filings. The Dubai bourse only discloses names of shareholders with more than a 5% stake.

Arabtec shares last traded up 0.7% at AED2.8 Monday.

-By Nikhil Lohade, Dow Jones Newswires; +9714 446-1694; nikhil.lohade@dowjones.com

Copyright (c) 2012 Dow Jones & Co.

(END) Dow Jones Newswires

14-05-12 0756GMT