Emaar Properties to Delist Construction Arm in $3.3 Billion Buyout to Streamline Operations

Dubai's Emaar Properties has announced plans to delist its construction unit, Emaar Development, from the Dubai Financial Market. The decision follows the board's approval of a Dh12 billion ($3.3 billion) buyout offer, a move intended to consolidate and streamline the group's business operations.

Emaar Properties is offering Dh15 per share for the Emaar Development shares it does not currently own. The company, along with its subsidiary EPHL, already holds over 3.2 billion shares, representing nearly 81% of Emaar Development's four billion ordinary shares. The remaining 793.5 million shares will be acquired through this offer, bringing the total buyout value to over Dh11.9 billion.

This offer represents a 19.4% premium on Emaar Development's closing price of Dh12.56 on November 2, the last trading day prior to the board meeting announcement. Emaar Development's shares closed down approximately 0.4% at Dh14.52 on Thursday.

In a filing to the Dubai Financial Market, Emaar Properties, the developer behind the Burj Khalifa, stated that the buyout is driven by "strategic considerations." The company explained that bringing the UAE development business fully within the group will allow for unified management and funding under a single capital allocation framework. This aligns with Emaar Properties' strategy of disciplined capital allocation and long-term value creation.

Furthermore, the acquisition will enable Emaar Properties to simplify and consolidate its group structure, managing the domestic development business on a fully integrated basis within the wider group.

Emaar Development reported a significant increase in its third-quarter profit, reaching Dh3.5 billion, an 8% rise year-on-year. Revenue for the quarter surged by 14% to Dh8.8 billion. For the first nine months of the year, UAE property sales amounted to Dh26.2 billion, with international development sales at Dh8.5 billion.

Meanwhile, Emaar Properties saw its third-quarter profit climb by 5.6% annually to Dh4.6 billion, supported by a strong revenue backlog and new project launches, despite global uncertainties. Revenue increased by nearly 3% year-on-year to Dh13.6 billion.