Arabtec confident of seeing off Meydan case
Company believes prospects of beating $952.8m claim are "good"
The company's newly-filed accounts for the period also reveal that Arabtec is confident of seeing off a fresh legal challenge from Meydan relating to a contract to build the Nad Al-Sheba racecourse in Dubai.
A joint venture consisting of Arabtec and Malaysian firm WCT had originally won the contract to build the racecourse in 2007 but it was terminated in 2009 after Meydan locked the firms out of the site and stopped making payments, citing project delays.
Arabtec has not made any provision in its accounts for the claim, though, as it is confident that it will not succeed.
"Management believes, based on continuing legal opinion received, that the prospects of success in the arbitration and legal case are good and that no additional provisions for the dispute are required," the company said.
It also warned that a project in Syria had been suspended due to the civil unrest in the country. Arabtec said that it was working with its Syrian client "to realise its assets and ensure that any exposure on its financial statements is covered."
Arabtec added that it was too early to tell what the impact on its accounts would be, but that it is not expected to be material.
The board of directors also approved new banking facilities and agreements paving the way for its new three-way joint venture with TAV Construction and the Greek Consolidated Contractors Company (CCC) which will deliver the $3bn contract to build the new Midfield terminal building at Abu Dhabi's international airport.
Board member Yasser Nasr Zaghloul, who is also CEO of the National Marine Dredging Company, has also stepped down from the board for personal reasons. Arabtec chairman Ebrahim Bel Selah thanked him for his contribution to the firm.