(MENAFN- The Peninsula) Investment Corp of Dubai (ICD), which hold stakes in many of the emirate's top companies, expects to complete a deal to increase its stake in Dubai Aerospace Enterprise (DAE) by the end of the year, a top official said.
The purchase from a unit of Dubai World is the latest example of asset shuffling in the emirate. This allows cash to be shifted from stronger state-owned entities to ones still struggling after a debt crisis at the start of the decade.
Such moves allow Dubai to prop up these indebted firms - Dubai World secured a $25bn debt restructuring in 2011, and is close to renegotiating the terms to give it more time to repay - as well as maintain ownership of assets it considers important cogs in its economy.
ICD is already the majority shareholder of DAE, holding 55 percent, and it was hoping to acquire the stake currently held by Istithmar World, Khalifa al-Daboos, deputy CEO of ICD and managing director of DAE, said.
"We have made an offer to them. I think most likely the deal will be completed by end of this year," he said, speaking on the sidelines of an aviation event.
He declined to disclose the price offered to Istithmar and how much of DAE the unit of Dubai World owned. However, a source aware of the matter, speaking on condition of anonymity as the information is private, said Istithmar held around 15 percent.
Other DAE shareholders are Emaar Properties, Dubai Silicon Oasis Authority and Dubai International Capital .
ICD, which has holdings in some of the emirate's most high-profile brands including Emirates airline and lender Emirates NBD, has already bought the Atlantis hotel from Istithmar, a luxury resort situated at the top of a manmade island in the shape of a palm tree.
DAE was set up in 2006 with the aim of becoming one of the world's biggest aircraft lessors, but was forced to cancel orders as funds dried up in Dubai's debt crisis. It has rebuilt its fortunes since, aided by its aircraft maintenance business StandardAero, and expects to report a higher profit for 2014 than the $410m it recorded last year, Daboos said.
Arizona-based StandardAero should post a double-digit percentage growth in EBITDA (earnings before interest, taxes, depreciation, and amortisation) in the current year, he added.
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