Saturday, Mar 31, 2012
(This story was originally published Thursday.)
DUBAI (Zawya Dow Jones)-Abu Dhabi's Mubadala Development Co. said it will transfer shares in Aldar Properties worth about 700 million U.A.E. dirhams ($190 million) to Abu Dhabi Commercial Bank as part of a loan agreement.
ADCB, the U.A.E.'s third-largest lender by assets, will make a loan to Mubadala secured by the shares, which equate to about 14% of the developer's outstanding share capital, the companies said in a joint statement posted on the Abu Dhabi bourse website.
"At maturity in April 2013 (or earlier if terminated prior to maturity), the shares will be transferred back to Mubadala," the statement said.
Mubadala acquired a large stake in Abu Dhabi-listed Aldar as part of an AED19.2 billion capital injection last March. Aldar issued AED2.8 billion of convertible bonds to Mubadala, and Mubadala announced the conversion of AED2.1 billion of them in December, raising its stake in the struggling developer to 49%.
ADCB and Mubadala did not disclose the full value of the loan. But based on Aldar's closing share price Thursday, the security for the loan amounts to around AED700 million, according to Zawya Dow Jones calculations.
Aldar has suffered in recent years as real estate valuations in its home market declined. The company made an AED642.5 million profit last year after taking an AED12.66 billion loss in 2010. Aldar, which is responsible for some of Abu Dhabi's biggest development projects, has sold some of its assets to the Abu Dhabi government and received a capital injection from Mubadala to shore up its finances.
Mubadala, which this week agreed to invest $2 billion in Brazil's EBX Group, had assets worth AED169.7 billion as of the end of last June.
-By Asa Fitch, Dow Jones Newswires, +971 4 446-1685, asa.fitch@dowjones.com
Copyright (c) 2012 Dow Jones & Co.
(END) Dow Jones Newswires
31-03-12 0700GMT
