Arabtec Holding Co. (ARTC) fell to the lowest level in a week as some investors questioned the government’s support for the United Arab Emirates’ biggest publicly traded builder.
Shares in the company, which helped build the tallest tower in the world, pared an earlier 9.9 percent drop to close 1.8 percent lower at 4.38 dirhams, the lowest since July 14. The stock yesterday fell the maximum allowed after state-controlled Aabar Investments PJSC, the builder’s second-largest shareholder, said talks about its stake in the company are “strictly confidential.”
Arabtec’s shares were halted from trading at the end of last week pending clarification of its ownership. Aabar is in talks to buy at least half of a 28.9 percent stake held by the construction company’s former Chief Executive Officer Hasan Ismaik, a person with knowledge of the situation said July 15. Aabar is negotiating a price of 5 dirhams to 6 dirhams a share, the person said.
“Retail investors were expecting Aabar’s confirmation of buying Ismaik’s stake,” Nayal Khan, head of institutional sales and trading at Naeem Holding brokerage in Dubai, said by telephone today. “They didn’t get that and now they are in doubt whether a deal will be reached, and this is the reason for the selldown.”
The builder’s stock has risen 68 percent so far this month after Chairman Khadem Al Qubaisi said July 2 Aabar may increase its holding. Arabtec’s stock was the most traded on Dubai’s benchmark index today, as volume rose to 2.7-times the three-month daily average. Dubai’s exchange allows stocks to decline a maximum of 10 percent a day.
To contact the reporter on this story: Sarmad Khan in Dubai at email@example.com
To contact the editors responsible for this story: Samuel Potter at firstname.lastname@example.org Dana El Baltaji