Dubai’s biggest bank is going after a plot of land in the city’s financial hub that belongs to debt-laden Al Jaber Group, Bloomberg News reported. Emirates NBD PJSC is seeking to seize or sell the undeveloped land in the Dubai International Financial Centre after becoming frustrated by the pace of assets sales under Al Jaber’s debt restructuring, according to people familiar with the matter and an enforcement letter sent by the bank.
United Arab Emirates
First Abu Dhabi Bank (FAB) has started an auction process for a Dubai hotel operated by Shangri-La and owned by indebted construction group Al Jaber with a starting price of 700 million dirhams ($190.59 million), two sources said, Reuters reported. Al Jaber, best known as a contractor but with interests across a range of sectors, has struggled since a construction downturn in the United Arab Emirates after the global financial crisis.
Courier app Fetchr, once one of the Middle East’s largest startups, raised as much as $10 million in emergency funding to help avoid collapse, Bloomberg News reported. The Dubai-based company, which offers delivery and logistics services to e-commerce firms, is also in the process of securing as much as $25 million in additional funding to turn the company around, according to people with knowledge of the matter.
Creditors of Abu Dhabi-based Al Jaber Group are considering enforcing claims against the owners of the group after delays in executing a restructuring agreement, the latest in a long-running debt dispute, two sources familiar with the matter said. Al Jaber, best known as a contractor but with interests across a range of sectors, has struggled since a construction downturn in the United Arab Emirates after the global financial crisis, Reuters reported.
A new insolvency law to help UAE residents clear bad debts will ease the burden of heavy liabilities as the threat of criminal sanctions is removed, according to analysts, The National reported. The federal law, passed by the UAE Cabinet on Sunday, protects Emiratis and residents in debt from legal prosecution and decriminalises their financial obligations, offering them an opportunity to work to resolve their financial dilemma while still supporting their families.
Dubai needs to halt all new home construction for one or two years to avert an economic disaster brought on by continued oversupply, according to one of its biggest builders, Bloomberg News reported. “We’re entering a crossroads now,” Damac Properties PJSC Chairman Hussain Sajwani said in a Bloomberg interview. “Either we fix this problem and we can grow from here or we are going to see a disaster.” Damac’s chairman is the latest executive to call for curbs on construction in a market that’s been on a downward trajectory since it peaked five years ago.
The United Arab Emirates lifted a ban on its citizens visiting Lebanon on Monday as the Beirut government sought UAE help in steering the heavily indebted economy out of deep crisis, Reuters reported. Prime Minister Saad al-Hariri, leading a delegation to Abu Dhabi seeking support, had told Reuters he was hoping the UAE would inject cash into its central bank. Before the lifting of the travel ban was announced, Hariri said he was “optimistic” after visiting the UAE and meeting with Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed al-Nahyan.
Dubai continues to service its debt and is ready to take on more if needed, an economic official said on Wednesday, adding that current debt was $124 billion, Reuters reported. “We continue to service the debt on time, as scheduled. We are ready to take on more debt, if need be,” Raed Safadi, the chief economic advisor at Dubai’s Department of Economic Development, said at an event. His comments came after Reuters had reported on Sept. 10, citing sources, that the government of Dubai has held talks with banks about a potential issue of U.S.
A weakening property market in the United Arab Emirates (UAE), where prices have fallen by more than 20% since their peak in 2014, is likely to put more pressure on the asset quality of the banking sector, Fitch Ratings agency said, Reuters reported. The UAE, home to the world’s tallest tower, the Burj Khalifa, has faced a sharp real estate slowdown due to oversupply and weaker investment appetite amid lower oil prices.
Arabtec Holding PJSC shares soared in Dubai after the company started talks to merge with Abu Dhabi-based Trojan Holding LLC, Bloomberg News reported. The stock advanced as much as 13%, the steepest intraday gain since July 2017, as Arabtec said the entities began a study to potentially combine their construction businesses and may merge after technical, financial and legal reviews. It didn’t provide further details. The talks come as a property-market slowdown weighs on companies in the United Arab Emirates.