(MENAFN - Khaleej Times) The shareholders of Abu Dhabi's Aldar Properties and Sorouh Real Estate have approved their merger plan to become the biggest realty company in the Middle East and North Africa.
Subject to the satisfaction of the merger's conditions, Aldar and Sorouh will now apply for a resolution of the UAE Minister of Economy to approve the merger and the associated steps required to implement the merger, including the dissolution of Sorouh, the increase in the share capital of Aldar and the amendments to Aldar's articles of association.
On the effective date of the merger, Sorouh shares would be delisted from the Abu Dhabi Securities Exchange, and the company would be dissolved as a legal entity.
Aldar will then be named Aldar Sorouh Properties. It is currently anticipated that, subject to the satisfaction of these conditions, the merger will become effective this June. This timeframe is indicative only and is subject to change.
Under the merger proposal, Sorouh shareholders will get 1.288 Aldar shares for every share they own.
The merger will create the largest property developer with over Dh47 billion of combined total assets as of September 30, 2012, and combined market capitalisation of approximately Dh10.9 billion. The unified group will have a diversified portfolio of assets with total equity of Dh14.7 billion and an attractive pipeline of assets under development in Abu Dhabi.
"The merger will create a strengthened, more diversified company with a portfolio of revenue-generating assets and a very strong development pipeline that is able to take advantage of sustainable growth opportunities," Aldar chairman Ali Eid Al Mheiri said.
"This vote of confidence underlines the strong strategic rationale for uniting these two companies. Aldar Sorouh will combine complementary high-quality assets and strong management capabilities. The immediate focus of Sorouh's board and management team is to now successfully deliver this merger," Sorouh chairman Mubarak Matar Al Humairi said.
The proposed members of the Aldar Sorouh board following implementation of the merger are Abubaker Seddiq Al Khoori as chairman and Al Mheiri as vice-chairman. The other members will include Mubarak Matar Al Humairi, Dr Sultan Ahmed Al Jaber, Ali Majid Al Mansouri and Mohammed Haji Al Khoori. Ali Saeed Abdulla Sulayem Al Falasi, Mansour Mohamed Al Mulla, Ahmed Khalifa Mohamed Al Mehairi and Martin Lee Edelman will also be part of the board.
The majority of the proposed management team for Aldar Sorouh has been selected from the existing management of both companies. The team includes deputy CEO and chief portfolio officer, Mohamed Al Mubarak and chief finance officer Greg Fewer.
Other top managers will include chief strategy officer Paul Warren, chief operations officer, Fahed Al Ketbi and chief development officer Gurjit Singh.
By Haseeb Haider