Arabtec Holding, the Dubai-based company that helped construct the Burj Khalifa tower, has confirmed that its shareholders had voted to dissolve the company.
The board now has two months for discussions with stakeholders before a liquidity application may be submitted to courts.
News first broke on Wednesday that the shareholders of the construction giant had voted to file for liquidation, following a $216 million net loss in the first half of 2020.
Founded in 1975, Arabtec is famous for some of UAE’s famous landmarks, including Burj Khalifa.
In a statement issued late Thursday, the company said its primary objective is to provide stability for its staff, subsidiaries, sub-contractors, suppliers and other stakeholders.
The firm said the shareholders voted at a general assembly meeting to discontinue the company and dissolve it due to its untenable financial situation.
A number of strategic alternatives were considered by the board after a financial analysis prepared by restructuring firm Alix Partners.
Waleed Al Mokarrab Al Muhairi, chairman of Arabtec said that the pandemic has “exacerbated” the liquidity issues faced by the company.
“In recent years, limited liquidity in the construction sector has impacted the progress of Arabtec’s projects and this has been exacerbated by the effects of COVID-19,” he said.
Despite efforts to pursue legal and commercial entitlements and a restructuring of the company’s finances and operations, he said the situation in which Arabtec finds itself today is untenable.
“Shareholders have, therefore, voted to move forward with a plan of liquidation to maximise value for stakeholders through a controlled and efficient program. Over the coming weeks, the company’s board and management will work closely with regulators and stakeholders to maximize value for all stakeholders,” said Al Muhairi.
“Our current priority is to ensure that everyone directly affected by this decision, is treated fairly during this challenging time,” he added.
(Writing by Imogen Lillywhite; editing by Cleofe Maceda)
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