Will Dubai project firm Drake & Scull International make a comeback on DFM after 6 years?
It was in 2018 that Dubai engineering firm's stock was removed after lax reporting
Dubai: Will Drake & Scull International make a comeback on DFM? The Dubai engineering company’s current management sure is hoping to do just that.
It plans to call a meeting of the general assembly to get approval to resume trading in the company’s shares. It was in November 2018 that DFM stopped trading in the stock, brought on by revelations that the financials reported failed to provide a true insight on (accumulated) losses as well as other reporting gaps. DSI, one of the biggest names in the UAE’s project management space at the time, had by then hit losses of Dh4 billion plus.
“A comeback on DFM would be a great chance to re-establish market credibility,” said an analyst. “Given that the company has convinced the authorities to put a stay on liquidation and give it more time to rebuild its financial position.”
Drake & Scull, which has won contracts in the recent past, currently has liabilities of more than Dh4 billion, including payments that need to be made on contracting firms associated with it on past projects.
More time for a turnaround
It was recently that a Dubai court stopped the company from going into liquidation after the management provided a fairly detailed roadmap on how a turnaround can be brought about. The company has also secured approval from its lenders and creditors to give it time on making the process click.
Also up for shareholder approval is the planned increase in the share capital, according to the terms approved by the SCA, the UAE stock market regulator, and by DFM.
Another would be to get clearance on a mandatory convertible Sukuk issue that too is part of the settlement plan.
"The coming general assembly meeting will resolve on the restructuring plan steps. This includes the additional share capital subscription and the share trading resumption.
"In parallel, the company is preparing to ramp up its operations and is already working on bidding important projects for reputable clients in UAE and a broad.
"We are full of hope that the coming back will of the company will be on solid basis and anticipate to have DSI share trading resumption by early Q2 of this year."
- Spokesperson for Drake & Scull Int