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Union Properties allays fears over links to trouble-hit Abraaj

Abraaj Group has been forced to restructure and offload assets amid allegations of misusing funds

Union Properties has moved to allay fears it is exposed to Abraaj Group.
Union Properties has moved to allay fears it is exposed to Abraaj Group.

Union Properties has distanced itself from the Abraaj Group by stating it has no investments linked to the troubled investor.

In a filing to the Dubai Financial Market, the developer said it had received multiple enquiries from a group of shareholders asking if Union Properties would be impacted by the restructuring and asset stripping under way at Abraaj Group.

In a statement, the developer said: "The board of directors would like to assure the shareholders that Union Properties PJSC and its subsidiaries do not have any investments in The Abraaj Group or any of its projects or funds, and there is not relationship between the company and the Abraaj Group in this regard."

READ: Dubai's Abraaj sells $52m stake in Egypt contractor Orascom

The developer made the announcement following a restructuring and provisional liquidation process under way at Abraaj Group, a private equity investor founded by Pakistani financier Arif Naqvi.

On 18 June, Abraaj Group confirmed that three executives from PwC had been appointed as joint provision liquidators to manage a restructuring process at the firm, which has reportedly faced allegations of misuing funds.

Liquidators are now helping the troubled investor to restructure and sell some of its assets.

Partner at PwC and one of the joint provisional liquidators, Michael Jervis, said: “Our role as joint provisional liquidators is to manage the restructuring of Abraaj Holdings in an orderly fashion, safeguard the assets of the company, and ensure that the interests of creditors, employees, and broader stakeholders are fully served." 

Jervis added that the company will "swiftly move into a stable phase of operations whereby restructuring plans and asset disposals can be executed upon in a protected and controlled environment."

Since the appointment of restructuring experts, Abraaj Holdings has sold the group's Latin America, Sub-Saharan Africa, North Africa and Turkey funds to Colony Capital.

Earlier this month, Abraaj Group sold its 5.4% in Egyptian contractor Orascom.

According to a Bloomberg report cited by Arabian Business, the restructure of Abraaj may have come about "amid allegations of misused funds". 

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Construction Week - Issue 749
Sep 15, 2019