Dubai investment bank Shuaa Capital, which is in the process of merging with its biggest shareholder, swung to a first-quarter loss due to legacy provisions for its exposure to private equity company Abraaj.
Shuaa posted a Dh24.9 million net loss for the three-month period to the end of March, compared with a Dh11.7m profit a year earlier, according to a statement the company filed to the Dubai Financial Market, where its shares trade. “Certain one-off provisions and a change in accounting standards” also contributed to the loss for the reported period, the company said on Thursday.
Shuaa’s lending division recorded Dh4.4m in losses against a profit of Dh2.2m in 2018. Its corporate business recorded a Dh21.2m loss, compared to Dh7.7m profit in the corresponding period last year, due to provisions relating to its investment in an Abraaj-controlled fund and higher financing costs.
Abraaj, which claimed to have managed almost $14bn in funds, was forced into liquidation last June after a group of investors, including the Bill & Melinda Gates Foundation, the World Bank’s International Finance Corporation and The Overseas Private Investment Corporation, a US government development financing agency, commissioned an audit to investigate the alleged mismanagement of money in its healthcare fund.
Shuaa's revenue rose to Dh55.4m in the first quarter from Dh33.2m at the end of the March 2018.
“Our core operating businesses of investment banking, capital markets and asset management continued to grow in profitability, while certain one-off provisions and higher financing costs dragged our overall results into a loss,” Fawad Tariq-Khan, chief executive of Shuaa, said.
“That said, our continued growth in our core operations continues our strategy of solidifying our recurring revenue base taking us towards sustained long-term profitability.”
The company said plans to merge with Abu Dhabi Financial Group, its biggest stakeholder, are progressing. In March, the company said it was in talks with ADFG for a consolidation and that both entities set up working groups made up of senior executives to review the potential of the tie-up.
On Thursday, Shuaa said merger talks are progressing through a strategic investment structure where the combined entity will continue to operate as a publicly listed company.
“The company is going through final stages before regulatory and shareholder approvals will be sought,” the lender said.
Swiss bank UBS is advising Shuaa, which has also hired law firm Linklaters as legal adviser on the transaction, a person familiar with the matter told The National in March. ADFG, an alternative investment company with $20bn of assets under management, has recruited US lender JP Morgan and law firm Herbert Smith to work on the deal.
UAE currency: the story behind the money in your pockets
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Starring: Ramy Youssef, Steve Carell, Jason Schwartzman
Director: Jesse Armstrong
Rating: 3.5/5
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Temple numbers
Expected completion: 2022
Height: 24 meters
Ground floor banquet hall: 370 square metres to accommodate about 750 people
Ground floor multipurpose hall: 92 square metres for up to 200 people
First floor main Prayer Hall: 465 square metres to hold 1,500 people at a time
First floor terrace areas: 2,30 square metres
Temple will be spread over 6,900 square metres
Structure includes two basements, ground and first floor
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Dream interviewee - Che Guevara
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TRAP
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The material was first discovered when Andre Geim and Konstantin Novoselov were 'playing' with graphite at the University of Manchester in 2004.
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Based: Dubai
Sector: Transport
Size: 9 employees
Investment: $1,275,000
Investors: Class 5 Global, Equitrust, Gulf Islamic Investments, Kairos K50 and William Zeqiri
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Producer: Zee Studios, Kamal Jain
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Rating: 2.5/5
Analysis
Maros Sefcovic is juggling multiple international trade agreement files, but his message was clear when he spoke to The National on Wednesday.
The EU-UAE bilateral trade deal will be finalised soon, he said. It is in everyone’s interests to do so. Both sides want to move quickly and are in alignment. He said the UAE is a very important partner for the EU. It’s full speed ahead - and with some lofty ambitions - on the road to a free trade agreement.
We also talked about US-EU tariffs. He answered that both sides need to talk more and more often, but he is prepared to defend Europe's position and said diplomacy should be a guiding principle through the current moment.
UAE currency: the story behind the money in your pockets
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Ad Astra
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Stars: Brad Pitt, Tommy Lee Jones
Five out of five stars
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PRIMERA LIGA FIXTURES
All times UAE ( 4 GMT)
Saturday
Atletico Madrid v Sevilla (3pm)
Alaves v Real Madrid (6.15pm)
Malaga v Athletic Bilbao (8.30pm)
Girona v Barcelona (10.45pm)
Sunday
Espanyol v Deportivo la Coruna (2pm)
Getafe v Villarreal (6.15pm)
Eibar v Celta Vigo (8.30pm)
Las Palmas v Leganes (8.30pm)
Real Sociedad v Valencia (10.45pm)
Monday
Real Betis v Levante (11.pm)
Aston martin DBX specs
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Transmission: nine-speed automatic
Power: 542bhp
Torque: 700Nm
Top speed: 291kph
Price: Dh848,000
On sale: Q2, 2020
Company profile
Company: Rent Your Wardrobe
Date started: May 2021
Founder: Mamta Arora
Based: Dubai
Sector: Clothes rental subscription
Stage: Bootstrapped, self-funded
Our legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
Zayed Sustainability Prize
