Aldar plays down delisting amid investor questions
Property firm releases details of convertible bonds in notification
Aldar Properties said it had no intention to delist from the Abu Dhabi Securities Exchange despite its scramble to manage its debts that has seen the government buy Ferrari World, among other assets.
Abu Dhabi’s biggest developer told investors that the option “had not been proposed or suggested” and will remain as a listed public joint stock company.
Last week the company agreed to sell its car-themed amusement park as well as related infrastructure to the Abu Dhabi government for AED 10.9 billion and residential units at Al Raha Beach.
At the same time it announced it would issue an AED 2.8 billion convertible bond to state–backed investment company Mubadala.
Today it confirmed that the bonds would have a coupon of 4% and convertible price of AED 2.3, subject to shareholder approval, with Mubadala’s with the convertible price for the bond sold to Mubadala in 2008 would be AED 11.73.
The company is aiming to pay down debts following a slump in the value of its property portfolio over the last two years has heavily hit income. In November the company posted an AED 731 million loss for the third quarter 2010, against a net profit of just over AED270 million for the same period last year. The loss was partially due to the revaluation of its assets to ‘fair value’ – or mark-to-market – accounting.
In a question-and-answer format posted to the Abu Dhabi bourse, the company revealed that all assets were sold at the cost of construction “plus margin”. It would issue the AED 2.8 billion convertible after the extraordinary general meeting.
“There is no intention to issue the remaining AED 700 million in the short-term, but the approval of the EGM will be sought to issue these additional AED 700 million convertibles within the next five years following the date of the EGM.”
The repayment on an Islamic bond, or sukuk, issued in 2007 would be converted at face value, the company added.
The company's shares closed down 2.87% on Wednesday to AED 2.04.