Dubai: Merger of Emaar Properties, Emaar Malls approved by regulator

A proposed merger move initiated between Emaar Properties and Emaar Malls received the final approval of the Securities & Commodities Authority (SCA).

In a joint statement on Monday, both entities said the merger process, as disclosed on March 2, 2021, has the unanimous support and recommendation of the board of directors of Emaar Properties and Emaar Malls (acting through its independent directors).

The move will reinforce Emaar Properties’ position as Mena’s largest integrated and diversified real estate company, while ensuring that both Emaar Properties and Emaar Malls are strategically positioned to capture opportunities in the marketplace and drive shareholder value, said the statement.

The merger will help boost Emaar Properties’ financial and operational performance through full consolidation of Emaar Malls’ earnings and cash flow generation, and further reduce volatility through an increase in the proportion of earnings from recurring businesses.

“The proposed transaction, subject to satisfying the required conditions, would be effected as a statutory merger with Emaar Malls shareholders (excluding Emaar Properties) receiving 0.51 Emaar Properties shares for every one Emaar Malls share. This represents a premium of 7.1 per cent to the closing price of Emaar Malls on 1 March 2021, the last trading day prior to the merger announcement, and a premium of 11.2 per cent to the market implied exchange ratio based on volume weighted average prices over the last one month to 1 March 2020. This represents a premium of 3.5 per cent to the closing price of Emaar Malls on 1 September 2021 and a premium of 4.4 per cent to the market implied exchange ratio based on volume weighted average prices over the last one month to 1 September 2021,” said the joint statement.

The merger is subject to several conditions, including the approval of the merger by vote of shareholders who own at least 75 per cent of the shares represented at quorate general meetings of Emaar Properties and Emaar Malls, said the statement.

One of the world’s largest real estate companies, Emaar Properties has a land bank of 1.7 billion sq ft in the UAE and international markets.

— issacjohn@khaleejtimes.com