The largest in the contracting sector in the UAE .. Arabtec shareholders decide to liquidate the company and these reasons

An internal email stated that the shareholders of Arabtec Holding - the largest contracting company in the UAE - authorized the board of directors of the Dubai-listed construction company on Wednesday to submit a liquidation request due to its unsustainable financial position due to the repercussions of the Coronavirus pandemic.

Two sources told Reuters that shareholders have also authorized the board to appoint Alex Partners, Matthew Wilde, and any other person or persons the board deems fit as liquidators.

"In light of adverse market conditions, we regret to inform you that Arabtec shareholders have agreed to adopt a liquidation and dissolution plan due to the financial conditions of the company," said the letter, which was seen by Reuters.

Arabtec held a meeting of shareholders yesterday, Wednesday, to decide whether to continue work or to liquidate and dissolve the company after the Corona pandemic damaged its projects and incurred additional costs.

Shares of Arabtec Holding - which participated in building the Louvre Museum in Abu Dhabi and the Burj Khalifa in Dubai - have fallen by more than half since the beginning of this year, and it was decided to suspend trading on them prior to the shareholders' meeting.

And last month, the company announced that it suffered losses in the first half of the year amounting to 794 million dirhams (216 million dollars), bringing the accumulated losses to 1.46 billion dirhams.

On the ninth of September, it said that it was calling for a general assembly meeting under one of the articles of the companies law in the UAE.

The law requires companies to vote on business continuity if the accumulated losses amount to half of the issued share capital.

Several Emirati companies have sought to extend the terms of their debts or agree on better terms in recent years, to avoid defaulting on them after the collapse in oil prices affected the energy, services and construction sectors.

And last week, creditors began enforcing claims against the Abu Dhabi-based Al Jaber Group, which has been facing difficulties since its debt grew in the wake of the real estate crisis in the UAE.

Drake and Scull of listed constructions in Dubai is also working to reach an agreement with its creditors outside the court under the UAE bankruptcy law.