The Meraas move to recapitalise DXB Entertainment will give some much needed maneuver space to get its finances in order. Image Credit: Virendra Saklani/Gulf News Archives

Dubai: Dubai’s theme parks operator DXB Entertainment has called a meeting on Wednesday (December 30) to consider the buyout offer from its majority shareholder Meraas. The transaction, once effected, will lead to the eventual de-listing of DXBE.

The DXBE stock has been quite volatile in recent trading sessions, and last Monday (December 21) saw the price drop by 5 per cent and thus hit the circuit-breaker. This came immediately after Meraas announced its intention to offer a buyout – at 8 fils a share – and recapitalise DXBE.

On Sunday (December 27), it shed 4.81 per cent to 10 fils.

What next
As per the Merger and Acquisition Rules issued by the UAE's Securities and Commodities Authority, DXBE will appoint an independent valuer to prepare a valuation report to determine DXBE’s fair price per share.

* If by any chance the valuation report indicates that the fair price per share is more than Dh0.08 per share (offered by Meraas), Meraas has the right not to proceed with the transaction.

Terms of offer

Meraas plans to acquire the senior bank debt of DXBE, with an outstanding balance (as at December 31) of  around Dh4.25 billion, and subsequently convert it into new shares of DXBE at Dh0.08 a share. Meraas will also convert the balance of the existing convertible bond instrument issued to it by DXBE in 2018 into new shares in the parks operator.

After these transactions, DXBE will increase its issued ordinary shares from 8,000 million to 62,822 million. Meraas will end up holding 93.92 per cent of DXBE’s total issued ordinary shares at that time.