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Abu Dhabi soars to highest level in more than three years

Abu Dhabi’s benchmark stock index advanced to the highest level in more than three years as the emirate’s two biggest real-estate companies prepare to meet this week to vote on a merger.

Aldar Properties surged five per cent and Sorouh Real Estate gained the most in more than three weeks. The developers, which were the most traded by value on the gauge, will hold shareholder meetings on February 21 to vote on the planned combination.

The ADX General Index rose 1.1 per cent to 2,968.54 points, the highest since November 2009. Shares of Aldar tumbled 14 per cent through yesterday since the developer’s board approved on January 21 a plan to offer 1.288 shares for each Sorouh stock in a government-backed acquisition to create Middle East’s third-largest publicly traded developer.

Sorouh’s stock has advanced eight per cent since the announcement as investors deemed the terms of the merger to favour the smaller of the two developers.

“Investors are accumulating before the meeting this week,” said Waleed Al Khateeb, Dubai-based senior finance manager at Daman Securities LLC. “There was some excessive selling after the merger was approved last month.”

Aldar’s stock climbed the most since January 8 to Dh1.47 while Sorouh increased 2.9 per cent, the biggest gain since January 23, to Dh1.76. About 58 million Aldar shares were traded, almost triple the three-month daily average.

Elsewhere in the Gulf Cooperation Council, Kuwait’s gauge gained 0.1 per cent and Bahrain’s measure advanced 0.3 percent. Dubai’s DFM General Index and the Bloomberg GCC 200 Index of the GCC’s most-traded shares slipped 0.2 per cent at 3pm in Riyadh.

The Tadawul All Share Index fell 0.3 per cent after a six- day rally, Qatar’s QE Index slipped 0.1 per cent and Oman’s MSM30 Index was little changed. In North Africa, Egypt’s benchmark EGX 30 Index decreased 0.2 per cent in its third day of declines.