Construction

Dubai’s Arabtec denies withdrawing from $40bn Egypt housing project

By Ben Flanagan

Posted on August 20, 2015

Builder says it is still discussing terms with officials; shares in the Dubai firm fall by almost 4%

PHOTO: In March 2014 Arabtec struck a deal, said to be worth $40bn, to build a million homes in Egypt. Credit: Shutterstock

The Dubai-listed builder Arabtec has denied reports it is withdrawing from a $40 billion scheme to build a million homes in Egypt.

The firm is still in negotiations with Egyptian officials over the ambitious project, it said in a statement to the Dubai Financial Market.

“The company denies its withdrawal from the housing project in Egypt, and reaffirms that it’s still discussing some related details with the… concerned parties,” it said.

Arabtec did not give further details of the media report that had claimed it planned to withdraw from the deal.

Shares in the company were on Thursday trading 3.88% down, at Dh1.98, at around 11.40am Dubai time.

Arabtec’s Egypt deal, first announced in March last year, has faced several stumbling blocks. In March top Arabtec executives were said to have met with Egyptian officials in a bid to get the massive deal back on track.

The original agreement was struck with the Egyptian army, but Arabtec is now believed to be negotiating with the housing ministry.

Today’s decline in Arabtec shares follows a 5% dip on Sunday, after the builder reported a second-quarter loss on the back of rising costs and a difficult trading environment.

Losses attributable to shareholders for the second quarter amounted to $195.56 million (AED718.3m), compared to a net profit of $27.9 million (AED102.4m) in Q2 2014.