Al Qatami says Deyaar can write off all accumulated losses dating back a decade ago with capital reduced from $1.57bn to $1.2bn
Deyaar Development, a Dubai-based property developer and real estate service provider, has announced that it will proceed with capital restructuring plans, having gained the necessary approvals from shareholders and the Securities and Commodities Authority (SCA).
According to a statement from the developer, at a recently held Annual General Meeting (AGM), shareholders approved the board’s recommendation to reduce Deyaar’s capital from $1.2 billion to $1.57 billion.
Shareholders had authorised Deyaar’s CEO and/or any members of the board to undertake the necessary procedures to allow the company to complete its capital restructuring, the statement added.
Deyaar also said that the effective date of the reduction would be announced after the creditors’ announcement, which will take 30 days according to regulations, and upon completing the formalities.
Lauding the shareholders for their support, CEO Saeed Al Qatami said: “The plan for capital restructuring proposed by our board of directors will enable Deyaar to write off all accumulated losses stemming largely from more than a decade ago, enabling us to further improve financial ratios and increasing our company’s attractiveness to investors and future financing.”
According to him, the capital restructuring plan will see the cancellation of 21.3% of the company’s shares.
This will be conducted in accordance with the Commercial Companies Law, the Company’s Article of Association, the rules and regulations of the SCA, and all of authorities’ related regulations.
Deyaar expects the capital restructuring process to be reflected in the market by end of May.
“We anticipate this to also have a positive impact on share price and demand, as well as the possibility of dividends distribution in case of accumulated profits and depending on availability of excess cash. This move is yet another positive step for Deyaar, which we fully believe will further strengthen our business,” he added.
Listed on the Dubai Financial Market and majority-owned by Dubai Islamic Bank (DIB), Deyaar is one of Dubai’s leading developers, with real estate ventures spanning key growth corridors and prime locations within the emirate.