The former CEO of Dubai-based construction company Drake & Scull International (DSI) Khaldoun Al Tabari has issued a statement refuting claims that he and his daughter owe the cash-strapped contractor 1 billion dirhams ($272.3 million).

Tabari’s statement followed a story by Bloomberg on Monday, citing unnamed company sources, which stated that an internal company probe into the conduct of previous management had found that Al Tabari and his daughter owed the contractor as much as 1 billion dirhams ($272.3 million).

“I refute in the strongest terms any suggestion that I or my daughter owe Drake & Scull International PJSC (DSI) any money at all, let alone the huge sums mentioned by some media outlets, and any suggestion that the previous management of DSI was guilty of any wrongdoing, impropriety, negligence or incompetence,” Al Tabari said in a statement issued to media on Wednesday.

“We acted at all times in accordance with all legal, regulatory and governance obligations, and in the interests of the company, its employees, and its shareholders,” he added.

Following several reports citing the Bloomberg story, DSI’s current management issued a statement to the Dubai Financial Market on Wednesday stating that it “wishes to confirm the existence of material financial violations from the previous management”. However, the statement did not mention the names of any individuals or the amounts involved in any investigation, adding that “the disclosure of the value of the violations and the individuals under investigation will be subject to coordination with the designated authorities in the UAE and their timely approval in the future”.

DSI had said in an earlier statement to Dubai Financial Market (DFM) last month that it had concluded its investigation, and had “delivered all of the violations of the previous management to the designated authorities in the UAE”.

Al Tabari’s daughter Zeina had previously served as a senior executive in the company. Al Tabari stepped down as the company CEO in October 2016 after former Arcadis Middle East CEO Wael Allan was drafted in to lead a restructuring of the troubled company, which involved securing an injection of 500 million dirhams of funds from Tabarak Investment.

Al Tabari said that all of the company’s financial dealings had been audited by major firms such as Ernst & Young and PwC, and were “in turn approved by the Board”.

“I will initiate libel claims against any unfounded news reports based on any such falsehoods as these could cause irreparable reputational damage to me and my daughter,” Al Tabari said.

“I reiterate that neither my daughter nor I have any financial obligations to DSI.  Any attempt to discredit or defame us will be taken seriously and is likely to have legal consequences,” he added.

Al Tabari sold the remainder of his stake to Tabarak Investment in June last year in a deal which made the company the single-biggest shareholder.

Tabarak Investment then became the majority shareholder in the company in September after injecting 500 million dirhams into the firm after a capital reduction exercise was carried out to extinguish some of the firm’s historic losses.

Tabarak Investment has since undertaken a complete shake-up of the company’s management structure, including the appointment of Fadi Feghali as its new CEO in March this year.

(Reporting by Yasmine Saleh; Editing by Michael Fahy)
(yasmine.saleh@thomsonreuters.com)

Our Standards: The Thomson Reuters Trust Principles


Disclaimer: This article is provided for informational purposes only. The content does not provide tax, legal or investment advice or opinion regarding the suitability, value or profitability of any particular security, portfolio or investment strategy. Read our full disclaimer policy here.

© ZAWYA 2018