أرابتك و Wct الماليزيه يسعيان الى الحصول على تعويض قدره 1.7 مليار من شركة ميدان

Reuters 26 February 2009:
WCT, Arabtec seek $460 mln for Dubai contract
By Jason Benham

Dubai – Malaysian engineering firm WCT Bhd said on Thursday it, along with Dubai’s Arabtec Holding (ARTC), was seeking at least $460 million in compensation for a Dubai race course contract that was cancelled last month.

WCT and Arabtec were initiating a civil suit and arbitration proceedings against Dubai’s Meydan LLC over an alleged “breach of contract” for cancelling the deal to build a racecourse in Dubai, WCT said in a statement on the Malaysian bourse website.

Meydan officials could not be reached for comment.

“In its request for arbitration, the joint venture has submitted a summary of the dispute along with the description of the claims totalling approximately 1.69 billion dirhams ($460.1 million) plus other sums,” WCT said in the regulatory filing.

Meydan said on Jan. 5 it had cancelled the deal to build a racecourse – which included a plan for a 1 kilometre (0.6 mile) grandstand – “because of non-adherence to the agreed time schedule for construction”.

“We’ve started arbitration proceedings,” Arabtec Holding Chief Executive Riad Kamal told Reuters by telephone, declining to specify how much compensation Arabtec was seeking. “It’s something we are still working on.”

WCT shares have tumbled more than 40 percent since the deal was cancelled. Arabtec shares also fell sharply in January, but have recovered this month after the largest United Arab Emirates construction company posted a sharp rise in 2008 profit.

WCT and Arabtec had said in 2008 a 50-50 joint venture had won a $1.3 billion contract to build the racecourse in Dubai.

Dubai’s property sector is suffering from a slump in prices after a six-year building boom that was spurred by the emirate’s move to allow foreign investors to buy properties and because of buoyant growth in Gulf economies during an oil price rally.

Dubai residential real estate prices have fallen by an average of 25 percent since a peak in September, Morgan Stanley said this month, adding that some $263 billion of projects had been cancelled or put on hold in the United Arab Emirates.

Dubai is one of seven emirates in the UAE, the world’s fifth-largest oil exporter.

Kamal, meanwhile, said he did not expect the arbitration process would have any further effect on its share price.

“It’s had an affect on our share price, but I don’t think there will be further ramifications,” Kamal said.

Bloomberg 24 February 2009:
Credit Suisse Cuts Price Target for Arabtec

DUBAI – Credit Suisse is keeping its “outperform” rating but cut its price target for Arabtec Holding (ARTC) saying the company is facing potential risks from project delays or cancellations that could affect its cash position.

The price estimate for the UAE’s largest construction company was halved to Dh3.0 from Dh6.0.

Credit Suisse said the key risk for Arabtec is the likelihood of an increase in its working capital requirements as a result of delayed payments by developers. It said it had raised its forecast for receivables to account for delays of payments from developers which would result in an increase in the company’s net debt position in 2008 and 2009.

Credit Suisse said it expects Arabtec to have a net debt position of Dh175 million in 2008 and Dh95.6 million in 2009.

Arabtec’s total 2008 backlog stands at Dh38.5 billion. It has a beginning backlog of Dh18.76 billion in 2009.

The “outperform” rating on Arabtec was maintained however as there is still significant upside on the stock. Arabtec is seen benefiting from the recent launching of the $20-billion bond by the Dubai government.

“This is positive news for Arabtec as Dubai real estate developers may be among the primary beneficiaries of this package, said Credit Suisse analyst Ahmed Badr.

Other potential catalysts for Arabtec is its foray into Saudi Arabia as well as the partial completion this year of its Dh2.7 billion Al Wa’ab City project in Qatar.