Dubai: Dubai Courts declared Arabtec Holding Company bankrupt and approved the liquidation of its assets in a final ruling on Monday.
The ruling also applies to Arabtec subsidiaries, including Arabtec Construction LLC, Austrian Arabian ReadyMix Concrete Company, Arabtec Precast LLC, Emirates Falcon Electromechanical Company (EFECO), Arabtec Construction LLC, and Emirates Falcon Electromechanical Company (EFECO ).
The court also appointed Ibrahim Abdul Malik and Dr Ali Rashid Sultan Al Kitoob as trustees of the procedures. They were assigned to list the inventory Arabtec companies, each separately, with a statement of the funds and the market value of all their assets by specialized evaluators. They were also tasked with the sales, liquidation, and distribution procedures to creditors.
The bankruptcy trustee will form at least three creditors’ committees. Each committee shall appoint a representative to consult and discuss all auction, sale, and liquidation procedures with the bankruptcy trustees and the court.
The courts have also stripped Arabtec Holding Company directors and members of its board of directors from managing the company and its subsidiaries in the country and abroad. “They shall no longer manage or dispose of Arabtec funds, pay any claims or borrow any sums in Arabtec’s name,” the court ruling stated. “They are obligated to hand over to the bankruptcy trustees all the company’s funds and documents, including detailed statements of all receivables and the original documents supporting those debts; and statements of the cases brought by and against the holding company or any of its subsidiaries and the outcome of those cases, which were under their hands within five days from the date of this judgment.”
More on Arabtec
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- Trustees appointed to oversee UAE construction giant Arabtec's liquidation
Dubai courts have also ordered the precautionary seizure of all balances, accounts and funds of Arabtec Holding, and its subsidiaries. “The parties to the seizure must therefore acknowledge what is in their debt within the legal term from the date of being notified, while preventing their employees from paying to others within the limits of the seizure amount, which is Dh10.1 billion, and they must transfer the balances they have to the court’s treasury,” the court verdict said.
It was in early January 2021 that Arabtec Holding entered bankruptcy proceedings after all efforts to pump in fresh capital or take in new investors failed to materialise. Arabtec at one time was one of the biggest contractors in the Gulf, having been associated with landmarks such as the Burj Khalifa and the Louvre in Abu Dhabi. However, on September 30, 2020, the Dubai-headquartered company filed for liquidation due to its untenable financial position following the fallout from the coronavirus pandemic.