Abu Dhabi’s Aldar Properties, currently in merger talks with Sorouh Real Estate, says it is committed to repay its huge pile of debt and sees further consolidation in the emirate’s property market.
The company, which has been rescued twice by Abu Dhabi with funds amounting to nearly $10 billion, will not need any more funds from the government, chief executive Mohammed al Mubarak, said on the sidelines of a property conference on Sunday.
“We are committed to all our debts and they will be paid, we are in a healthy financial position,” Mubarak told reporters. “We won’t need more (financial) help, we are comfortable on the financing side,” he added.
The potential merger of struggling Aldar and Sorouh unveiled last month could take some pressure off state investment fund Mubadala, which owns about 35 per cent of Aldar.
Aldar’s $1.25 billion 10.75 per cent bond, maturing 2014 was bid at 109.5 on Saturday, according to Thomson Reuters data, to yield 5.847 per cent, about 23 basis points tighter since beginning of the month.
The builder of the Yas Marina Formula One circuit, which was forced to sell key projects to the government including the Ferrari World Theme Park, is generating income from the lease of “many residential and retail projects”, Al Mubarak said. “Our model has to be to build more projects,” he added.
Aldar secured a 4-billion-dirham ($1.1 billion) credit facility from National Bank of Abu Dhabi last week, a deal expected to help the developer manage its liquidity needs.