DAMAC founder delays steps to go private until after regulator's review

Sajwani made a $595mln offer this month to buy out minority shareholders in DAMAC Properties

  
A trader talks on the phone during the opening of the Dubai stock market June 26, 2016. Image for illustrative purpose

A trader talks on the phone during the opening of the Dubai stock market June 26, 2016. Image for illustrative purpose

REUTERS/Ahmed Jadallah

DUBAI - The founder of DAMAC Properties has postponed efforts to take the firm private after the securities regulator of the United Arab Emirates launched a review of the transaction, the company said on Tuesday.

Maple Invest Co, the vehicle backed by founder Hussain Sajwani, said in a letter that acquisition procedures would be postponed until the UAE's Securities and Commodities Authority concluded the review.

The authority did not immediately offer a comment.

Sajwani made a $595 million offer this month to buy out minority shareholders in DAMAC Properties, which he has run for nearly two decades.  

DAMAC shares rose by more than 1% in early trade to 1.3 dirhams, at par with Maple's offer, before slipping back in midday trade at 1.28 dirhams.

"There is hope that the regulatory review may lead ultimately to a more generous offer to buy out minority shareholders,” said Hasnain Malik, head of equity strategy at Tellimer.

The offer came amid years of downturn in Dubai's property market, exacerbated by the economic hit from the pandemic.

Analysts saw the plan as a blow to Dubai's stock market, hit by a spate of delistings of major companies and an absence of new listings. 

Sajwani, who resigned as chairman and board member at the time of the offer, directly and indirectly owns 72.215% of DAMAC, regulatory filings show.

(Reporting by Saeed Azhar and Yousef Saba; additional reporting by Alexander Cornwell; editing by Clarence Fernandez and Jason Neely) ((Saeed.Azhar@thomsonreuters.com; +971 44536787; Reuters Messaging: saeed.azhar.reuters.com@reuters.net))


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