Arabtec Revives Plans to Sell Convertible Bonds as Profit Drops
Arabtec Holding Co., (ARTC) the biggest builder in the United Arab Emirates by market value, revived plans to increase capital and sell convertible bonds as it seeks financing for expansion amid a decline in quarterly profit.
“The board considered the company’s plans, expansion strategies and restructuring” at a meeting at the Abu Dhabi government-controlled International Petroleum Investment Co. office, Dubai-based Arabtec said in a statement today. “The board considered the funding options available to the group to achieve its expansion objectives including the increase of the capital and/or the issuance of convertible bonds.”
Construction companies in the United Arab Emirates are struggling after about $757 billion of projects were canceled or delayed in the aftermath of the 2008 property crash, Citigroup said in a report Oct. 16. Arabtec last year delayed the sale of convertible bonds and a rights share offering after its full- year profit missed analysts’ estimates.
Third-quarter profit fell to 35 million dirhams ($9.5 million) from 39.1 million dirhams in the year-earlier period, the company said in the statement. Arabtec posted a loss of 11.6 million dirhams in the second quarter. The median estimate of three analysts was for a profit of 11 million dirhams in the third quarter, according to data compiled by Bloomberg.
Aabar Investments PJSC, the company controlled by International Petroleum Investment, raised its stake in Arabtec to 21.6 percent this year. The shares gained 68 percent this year compares 19 percent increase for Dubai’s benchmark index.
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