UAE’s Aldar, Sorouh agree on merger proposal, claims report
Abu Dhabi’s two biggest real estate developers have reached an agreement to merge
Abu Dhabi’s two biggest real estate developers have reached an agreement to merge. A final deal is expected to be signed in coming weeks, according to news agency Reuters.
The proposed merger will be one of the biggest by listed firms in the Middle East. Aldar Properties and Sorouh Real Estate have a combined market capitalisation of about $2.5 billion. The merger will create a state-backed company with combined assets of nearly $15 billion.
Sorouh’s managing director Abu Bakr Seddiqi al-Khoury recently told Reuters “We are moving (forward) in the process.” Asked about the time schedule for a potential merger agreement, he said: “Within a month.”
The merger will be based on a share swap and will not involve a cash payment, sources said. The terms of the share swap could not be confirmed. Aldar and Sorouh declined to comment.
Aldar built Abu Dhabi’s Yas Marina Formula One motor racing circuit. It has relied heavily on the government over the past two years for funding. Abu Dhabi has spent more than $10 billion on the company.
Goldman Sachs and National Bank of Abu Dhabi are advisors to the steering committee overseeing the proposed tie-up. Credit Suisse is advising Aldar while Morgan Stanley will work with Sorouh.
