The announcement does not come as a surprise to us given the troubled state of the Dubai real estate market and there was always a possibility of Emaar being involved in consolidation of the market by virtue of its size and position.
Emaar’s press release states that the three private entities which are being proposed to merge with Emaar have a combined book
value of assets of c.AED126 bn and a total external debt of c.AED3.4 bn. Additionally, Emaar’s book value of assets as of 1Q09 was AED68 bn and had a total debt obligation of AED10 bn. As per the press release, the combined entity would have an indebtedness of AED13.4 bn and total assets of AED194 bn. There have been no further details provided on this proposed merger.