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UPP Chairman Says Not Takeover Target as Volumes Surge Third Day

Aug. 19 (Bloomberg) -- Union Properties PJSC chairman said the Dubai real-estate company isn’t a takeover target after trading volumes crossed 100 million shares for a third day.

Almost 106 million shares traded, or 2.7 times the three-month daily average and comprising about 20 percent of the total volume on Dubai’s stock market. The shares fell 0.4 percent to 45.8 fils at the close in the emirate, after surging 11 percent yesterday, when 424 million shares traded.

Emirates NBD PJSC, which holds a 31.4 percent stake in the company according to data compiled by Bloomberg, said last month it sold about a 16 percent stake in Union Properties. The real-estate company’s shares have gained 16 percent this year, lagging a rally of 64 percent for Dubai’s benchmark.

“There is no one or two companies or individuals buying and building up positions,” Chairman Khalid bin Kalban said by phone today. “It’s possible that Emirates NBD is selling.”

A spokesman for the bank couldn’t be reached for comment today.

Union Properties’ stock is “undervalued” and with the renewed interest in real estate, people are optimistic about future earnings and prospects, bin Kalban said.

Dubai’s property prices, which tumbled more than 65 percent from a peak in 2008, are recovering as the economy rebounds amid an acceleration in tourism and trade. Union Properties trades at 0.6 times book value, compared with a multiple of 1.2 for Emaar Properties PJSC, the developer of the world’s tallest tower.

Union Properties reported a 36 percent increase in second-quarter profit to 113.3 million dirhams ($31 million). One analyst rates the stock a hold and another a sell, according to data compiled by Bloomberg.

To contact the reporters on this story: Zainab Fattah in Dubai at zfattah@bloomberg.net; Arif Sharif in Dubai at asharif2@bloomberg.net

To contact the editors responsible for this story: Claudia Maedler at cmaedler@bloomberg.net; Andrew Blackman at ablackman@bloomberg.net

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