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Emaar Malls shares dip amid Souq.com bidding

Emaar Malls shares fell 0.78% on the Dubai Financial Market yesterday to close at $0.69 after news reports said the retailer was offering to pay $800m for Souq.com

Emaar Malls shares fell 0.78% on the Dubai Financial Market.
Emaar Malls shares fell 0.78% on the Dubai Financial Market.

Emaar Malls shares fell 0.78% on the Dubai Financial Market yesterday to close at $0.69 after news reports said the retailer was offering to pay $800m for Souq.com including a $500m convertible deposit, The National reported.

"Investors will have been worried about two things with this deal," said Sanyalak Manibhandu, the head of research at NBAD Securities. "Firstly the pricing – is Emaar Malls offering too much? And secondly the convertible deposit – that could dil­ute the shareholding."

While Emaar Malls was the strongest drag on the DFM yesterday, the index as a whole closed up 0.2% at 3,468.48.

Union Properties was one of the biggest gainers of the day, closing up 3.08% after the Dubai developer’s board recommended an 8% dividend.

Like many global markets, the DFM index had soared at the end of 2016 after the election of Donald Trump. But since February 8, when the index closed at 3,725.93, it has slumped 7%.

"It is unusual for the markets to price in so many positives for so long," Mr Manibhandu added. "Since the US healthcare bill was scrapped on Friday the bears out there will be saying: ‘If Trump can’t deliver on this bill then can he really deliver on anything?’"

The Abu Dhabi index closed down 0.67% at 4,465.19. Bank and property stocks were the biggest losers as interest rate rises weighed on the minds of investors. FGB dropped 1.15$ to close at $3.50.

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