Construction giant confirms that Abu Dhabi based investment firm only holds 20.76% stake in company
Arabtec Holdings, the Dubai based construction firm, has confirmed that Aabar Investment only holds a 20.76% stake in its shares, following media reports that the Abu Dhabi based investment firm had acquired a 53% stake in the construction firm.
Stocks in Arabtec fell by nearly 19% in the last 11 sessions amid concerns that Aabar had taken a majority stake in the company, leading to worries that Arabtec shares may be delisted, overlooking minority shareholder interests, Zawya Dow Jones reported.
Earlier in May, Arabtec named Kadem Abdulla Kadem Butti Al Qubaisi, chairman of Aabar as its new chairman, a move that triggered market speculation that the Abu Dhabi company held a much bigger stake in the construction company than early disclosed.
Another worry, traders said, was that if Aabar had already increased its stake substantially, then there wasn’t any upside left for the stock.
Paradoxically, Arabtec shares have undergone a strong rally over the last few months, boosted by market speculation that a strategic investor was building a strong stake in the company. The stock is up some 83% so far this year.
The buying into the construction firm comes after Aabar scrapped a 2010 deal to take a majority stake in it, but its recent renewed interest has cheered some investors who figure that this will strengthen the Dubai firm and boost its chances of acquiring business in the UAE capital.
The stake in Arabtec is broken up into: Aabar Real Estate with 5.18% and Aabar Petroleum Investments with 5.32%, according to previous Dubai bourse filings. The Dubai bourse only discloses names of shareholders with more than a 5% stake.