Hussain Sajwani Resigns as Damac Chairman To Take Developer Private

Published June 10th, 2021 - 06:05 GMT
Hussain Sajwani Resigns as Damac Chairman To Take Developer Private
The offer, made at AED1.3 per share, values Damac's minority interest at about AED2.2 billion, said S&P Global Ratings. (Shutterstock)

The possible delisting of Dubai-based Damac Real Estate Development by its key shareholder is credit neutral, according to S&P Global Ratings.

Damac's founding shareholder and chairman Hussain Sajwani, who currently owns 72.215% of the company, intends to take it private by buying out the minority shares.
 
As a consequence of his offer, Sajwani resigned as the chairman of Damac with immediate effect.
 
"We understand that delisting will not have any effect on Damac's balance sheet, since the consideration will be paid by the acquirer. We also note that Damac cannot distribute dividends due to restrictions under its bond indenture," stated S&P Global Ratings.


Therefore, we expect Damac's credit metrics will be unchanged, in line with the 'B' rating and negative outlook.

The offer was made through Sajwani's personal investment vehicle Maple Invest Company. Upon reaching 90% plus one share of interest, Maple Invest can squeeze out shareholders who have not accepted the offer, to ultimately reach 100% ownership.

The offer, made at AED1.3 per share, values Damac's minority interest at about AED2.2 billion, said S&P Global Ratings.

A change in Damac's financial policy, dividend distribution, or governance practices would have an impact on the rating, it added.


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