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Arabtec objectives to bankruptcyMENA

Arabtec objectives to bankruptcy

On Sunday, Arabtec Holding (one of Dubai’s leading construction companies) filed a bankruptcy petition with the Dubai Court, including petitions on behalf of its four subsidiaries.

The Covid-19 pandemic has been rough on Dubai’s construction companies (sorry, we don’t mean to sound like a broken record). Last September, Arabtec’s shareholders were forced to authorize the company’s board of directors to file for liquidation after realizing losses of Dh1.5b.

The court-appointed panel of experts (appointed by a Dubai Court bankruptcy judge) will be tasked with creating reports for each subsidiary and the operation as a whole to ascertain whether Arabtec is considered indebted.

why it matters
In the UAE, companies whose accumulated losses amount to at least half of issued share capital are required to vote on whether operations should continue. If Arabtec Holdings is proven to be indebted, the company will likely get a chance to restructure and save its business.