April 17 (Bloomberg) -- Aldar Properties PJSC, the Abu Dhabi property developer exploring a merger with Sorouh Real Estate Co. (SOROUH), signed a 4 billion-dirham ($1.09 billion) revolving credit facility with National Bank of Abu Dhabi PJSC.
The three-year facility will allow Aldar to “optimally manage its working capital and liquidity requirements over the next three years,” Aldar said in an e-mailed statement today.
The new funding demonstrates “smooth access to financing markets in support of our standalone business plan,” Greg Fewer, Aldar’s chief financial officer said in the statement. “Our financial profile is strong as a result of the comprehensive restructuring undertaken in 2011.”
Aldar, which is building thousands of homes and offices in Abu Dhabi, received 36 billion dirhams in government support last year and the company sold assets including a Ferrari theme park to the state. Aldar struggled to pay debt after the global credit crisis caused banks to curtail mortgage lending, leading to more than 50 percent drop in property prices since 2008.
Aldar and Sorouh, Abu Dhabi’s biggest developers, said March 11 they had set up a team to study a possible merger with the “blessing” of Abu Dhabi’s government, which owns stakes in both. The team will present its recommendations to the two companies within the next three months, it said then.
Aldar reported Feb. 13 a better-than-expected full-year profit of 642.5 million dirhams as the company sold more land and properties. It had a loss of 12.7 billion dirhams in 2010.
The shares were unchanged at 1.12 dirhams at 11:34 a.m. in the emirate today. They have risen 22 percent this year.
To contact the reporters on this story: Arif Sharif in Dubai at firstname.lastname@example.org; Shaji Mathew in Dubai at email@example.com
To contact the editor responsible for this story: Claudia Maedler at firstname.lastname@example.org