Apr 21 2009 |
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Al Qudra sees no need for IPO or bond issue
Abu Dhabi's Al Qudra Holding said yesterday the launch of an initial public offering and bond issues are not in the company's funding strategy and there will be no new projects announced this year.CEO Mahmoud Ibrahim Al Mahmoud, who is also chairman of Al Qudra Real Estate , told Emirates Business the company has no problems with funds to deliver all the projects already announced and the focus this year will be on fulfilling the commitments made for their on-time delivery.
"Frankly speaking, we don't need to go public. An IPO will be according to our funding strategy. And our funding strategy does not include an IPO nor bond issues. The current market is not ideal for an IPO, and at the same time we have got a profitable business that is sustainable. We also have no borrowing plans. We also are not looking at using any debt at the moment because for every project that we have launched we have secured its funding already," said Al Mahmoud.
He also said not a single project has been delayed due to the current global meltdown, and that all the projects are on track as scheduled for delivery. "We have not delayed any of our projects, and everything is according to plan and everything should be delivered on time," he added.
When asked if any new plan or project was in the pipeline for announcement in 2009, Al Mahmoud said: "We are not launching or announcing any new projects this year. Our core focus is to fulfill our commitments made to deliver the in-hand projects without delay and on time. We would rather focus on the ongoing projects because everyone wants to see results. That is what we have promised and we are going to fulfill that."
When asked about the size and value of the company's real estate portfolio, Al Mahmoud said since Al Qudra is a private joint stock company, he could not discuss or reveal any figures.
"Because of our shareholders, we have no obligation to disclose such figures to others except the shareholders. I can tell you one thing that we are among the largest in Abu Dhabi," he said.
About expansion plans, he said the company looked at various real estate segments last year when "we decided to move into development from being master developer. Basically the end-user is the ultimate target. One thing that was very common back then, beginning of last year, was that there was a lot of speculation in the market. So we decided not to build for the speculators, but rather the end-users".
"We made sure that we knew the outlines, we did due diligence to find out who is our client, we looked at financial adequacy and at the same time we did not release quantity into market. Rather we limited supply of our properties, which resulted in a very good result this year," he said.
He also said the company, with its strategic plans, has managed to secure some savings in building materials and cost of construction.
When asked about plans for expanding the company's international portfolio, Al Mahmoud said Al Qudra always looks at and studies the global market for potential investment projects but that was the long-term plan. "Expansion of international portfolio is not on the short-term plan this year or the next year. Of course, we need to be cautious as well in the overall economic climate, because you cannot expand without taking that into consideration. We are not going to any new market now, but definitely geographical expansion is on our agenda."
Referring to last year's financial results, Al Mahmoud said the results exceeded expectations. "The last quarter of 2008 was good. It was actually better than what we had expected," he added.
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