Oman's CMA dissolves board of Al Hassan Engineering Co
Capital Markets Authority forms temporary board to "ensure the continuity of operations" at loss-making contractor
Oman’s Capital Markets Authority (CMA) has issued a decision to dissolve the board of directors of cash-strapped Omani construction contractor Al Hassan Engineering Company, which delivers engineering, procurement, and construction (EPC) services for oil and gas, petrochemicals, and utilities projects.
In a missive to Muscat Securities Market, the listed contractor – which earlier this year said was facing challenges related to cash-flow, payment delays, and dispute claims – said CMA would appoint a temporary board of directors, which would later be tasked with appointing a permanent board for Al Hassan Engineering Co.
CMA’s statement, shared by Al Hassan Engineering Co, stated that it was dissolving the board in accordance with Article (148) of Oman’s Commercial Companies Law, promulgated by Royal Decree No 18/2019.
The temporary board has been appointed for three years, but its operations may be extended by CMA if required.
Ali Mohammed Jumah Al Lawati will chair the temporary board of Al Hassan Engineering Co, with fellow members to include Abdulla Said Al Shuely, Baha Mohammed Redha al Lawati, Al Salt Mohammed Al Kharusi, Ilham Murtadha Habib Al Hameed, Said Salam Al Shaqsi, and Zubair Rafeez.
A vice-chairman and a company secretary each will be appointed for Al Hassan Engineering Co during the board’s first meeting, with the interim board also required to implement actions and organisational changes required “to ensure the continuity of operations, financial stability, and mitigate risks to shareholders”.
The EPC contractor posted a $4.9m (OMR1.9m) loss for Q1 2018, which followed the consolidated loss of $69.45m (OMR26.74m) it reported in its full-year trading figures for 2017.
Another quarterly loss for the business was put down to “inadequate liquidity”, and Al Hassan Engineering Co decided to “discontinue UAE operations” as its subsidiary filed for liquidation in April.
On 15 July 2019, Construction Week reported that Al Hassan Engineering Co had posted profits of $2.4m (OMR912,000) for H1 2019, a 134% hike over $7m (OMR2.7m) of losses it posted in H1 2018.
Income at Al Hassan Engineering Co grew by 69% year-on-year in H1 2019 to reach $49.3m (OMR19m) during the period.