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Muscat Bourse OKs Listing Of New Local Firm On Third Market

Wednesday, Feb 08, 2012

BEIRUT (Zawya Dow Jones)--Oman's Muscat Securities Market Wednesday said it has approved the listing of the 2.5 million shares of the local Oasis Development Co.--a new closed joint stock company.

The shares will be listed on the bourse's third market effective from Thursday, the Muscat bourse said in a statement posted on its website.

In December, Oasis Development's founders were granted a license by the country's ministry of commerce and industry to establish the new company with an issued capital of 2.5 million Omani rials ($6.49 million), according to the statement.

The third market is a section of the Muscat bourse where closed joint stock companies may be listed along with other legal forms of companies or investment funds that don't meet the requirements for listing on the regular market. The bourse also has a parallel market and a bond market.

-By Shikrallah Nakhoul, Zawya Dow Jones, +961 1 985757, shikrallah@zawya.com

Copyright (c) 2012 Dow Jones & Co.

(END) Dow Jones Newswires

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Arabtec's 2012 Rally Based On Rerating But Hldr Change Speculation Lingers

Wednesday, Feb 08, 2012

--Possible re-rating of stock by some portfolio investors likely triggered speculative buying

-- Arabtec says people may be taking a commercial view on new project wins; no shareholder structure change

--DFM says, as a rule, it monitors all price movements and will take action only if necessary

By Nikhil Lohade

Of ZAWYA DOW JONES

DUBAI (Zawya Dow Jones)--A white hot rally in Arabtec Holding shares this year is most likely linked to some investors re-rating the construction company due to its growth prospects, according to market observers.

Once trading volumes started building up, other investors jumped in amid speculation that something "positive" is likely triggering the rally.

Arabtec shares have risen sharply in the past several weeks but most analysts and traders have struggled to explain the spectacular gains. The stock has added some 67% this year so far on good volumes, triggering wide speculation on the possible reasons for the rally.

A spokesperson for Arabtec told Zawya Dow Jones on Sunday that there has been no specific new announcements on its projects, but added, "we are winning projects and people may be taking a commercial view on this otherwise there has been no shareholder structure change." The company has since then not been reachable for comment.

A Dubai Financial Market official meanwhile said Wednesday that the bourse, as a rule, monitors all price movements. "We take action only if we see it necessary." The bourse also discloses the names of investors whose holdings hit 5% of a company's share capital, but no such new disclosures have been made recently.

There are several possibilities that could be fueling the rally, analysts say. The obvious speculation is that a strategic investor is interested in acquiring a big stake in the company. The other scenario is that some investors have increased their portfolio holding of the stock on expectations of better earnings and prospects for the company.

"The market is re-evaluating the stock in light of strong expected earnings and expectations of a big stakeholder to acquire a share in the market," Marwan Shurrab, a trader at Gulfmena Investments, said this week.

Increasingly though the view is that the company is likely being re-rated, after losing value in the past two years as it struggled to recover from a sharp downturn in its home property market.

Activity in the Dubai real estate market has mostly stalled since the global financial crisis in 2008 sent property prices in the emirate tumbling by more than 50%. Arabtec shares lost about 75% in value since mid-2008 to the end of 2011.

The company meanwhile has diversified its activity in the region. Shuaa Capital's Roy Cherry said investors still see value in Arabtec as the company is at an attractive valuation given its size and scope in the region and its future prospects in Saudi Arabia.

A recent announcement by the Abu Dhabi government that it's to re-start spending on projects that had been temporarily suspended in 2011 is also being viewed as positive for Arabtec 's prospects. An Arabtec unit in January was awarded three small contracts in the U.A.E. capital worth a combined AED256 million.

The company also told analysts in December that the on-again, off-again contract with Gazprom Neft in St. Petersburg is back on. "This represents a potential additional backlog of AED10 billion; however, it is totally unclear at this point whether the contact will be re-tendered, or even when a final decision about it will be taken," said an analyst at NBK Capital.

The company is likely to be in the spotlight over the new several days as investors continue to speculate about possible reasons for the recent rally. Some profit taking is expected though, as seen Wednesday, when Arabtec shares closed down 1.5% at AED2.66.

A clarification from Arabtec would help, while any news flow involving a big stake purchase is likely to warrant action from the market regulator, especially if someone benefited from the information, traders say.

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

(Tahani Karrar-Lewsley in Dubai contributed to this story.)

Copyright (c) 2012 Dow Jones & Co.

(END) Dow Jones Newswires

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