Arabtec rethinks pilings firm purchase as credit dries up

A tightening credit market has caused Arabtec Holding to halt plans to buy a local piling contractor until conditions become clearer, its chief executive said today. Local banks have already started to rein in lending for construction projects as the fallout of the global credit crunch hits the region and, as a result, puts a squeeze on financing for developers. "We didn't think it would be a good idea to go ahead and fling money at something like this right now," said Riad Kamal, the chief executive of Arabtec.

"So we're going to wait and see how things develop - once Eid and Cityscape are over we'll have a better idea of how things will go and will take it from there." Mr Kamal also said that the firm, which has a backlog of about Dh50bn (US$13.6bn) worth of contracts, was eyeing more opportunities beyond the UAE in expectation of a slowdown in its home market. The company expects to win three contracts in Saudi Arabia early next year, which together are worth Dh2.9bn.

agiuffrida@thenational.ae