Dubai: Union Properties has struck its second biggest transaction in recent weeks, this time on a debt payout agreement with a leading UAE bank.
Recently, the Dubai developer’s Board of Directors agreed by a majority vote to pay off the Dh825 million to Dh875 million under the settlement plan. This is to be paid within 9 months of the deal with the bank being signed – and in four instalments.
The debt exposure with the bank had been hanging over Union Properties – currently fine-tuning a turnaround plan – for some time. With the board providing the go-ahead, the company has a defined timeline to clear this one off its books.
Recently, the developer confirmed it is getting Dh620 million from its ex-chairman as part of a settlement it had reached with the individual. The payment was to be done under a ‘structured instalment plan’.
“Union Properties is clearing some of the legacy issues – these two deals represent a major win for the company,” said an industry source. “The focus has to be on operational matters, and what sort of future cash flow it can generate.”
The stock is up 8 per cent on DFM for the year to date. It had during the year even shot up a near 40 per cent as investor talk swirled about a clear turnaround plan and its implementation schedule.
Investors will now await to see how the full-year 2023 financials will be once they are published early next year.
