May 22, 2012
The government of Abu Dhabi has selected four lenders as financial advisors for the potential state-backed merger of property developers Aldar Properties and Sorouh Real Estate, Reuters has reported, citing three sources aware of the matter. The emirate is contemplating merging indebted Aldar with Sorouh in a tie-up that could create a company worth some $15bn in assets. However, analysts said the tie-up is complicated, given the massive land banks the two companies hold and the work involved in arriving at a deal structure. Aldar has relied heavily on the government over the past 18 months for funding, receiving more than $10bn from the government, equivalent to the amount Abu Dhabi deployed to rescue Dubai from a bond default in 2009.
