Tabarak Partners, a Sharia-compliant finance company, is facing a petition to wind up after its partners became embroiled in a commercial dispute. If it is ordered to be liquidated by Dubai International Financial Centre (DIFC) Courts, it would be the first case involving an Islamic advisory company within the free zone to be wound up. "We are petitioning for winding up the partnership on just and equitable grounds as the partners are in deadlock," said Kaashif Basit, the managing director of JSA Law, which is representing two non-executive partners of Tabarak Partners.
A court date is scheduled for May 19 and 20 when the results of a report by the appointed provisional liquidator examining the financial position of the company is considered. JSA Law has applied for winding up the firm on behalf of non-executive partners Andrew Tamplin Clout and Hussain al Awlaqi. They are in dispute with executive partners Khuram Hussain and Ziad Baya'a. Mr Hussain is the senior executive officer and Mr Baya'a the chief financial officer.
It is only the fourth insolvency case to be tried at the DIFC Court. Orion Holding Overseas, a financial services firm once valued at almost Dh1 billion (US$27.2 million), was ordered to be involuntarily wound up by the court in January. That case marked the end of a bitter dispute between shareholders and the failed Dubai company's management. With its own commercial laws, the DIFC has a more developed insolvency regime than local courts.
Tabarak was given authorisation by the Dubai Financial Services Authority (DFSA) in July 2007 to provide Sharia structuring, advisory and investment distribution products. It was granted a licence to advise on financial products and arrange credit and deals in investments. According to Tabarak Partner's website, the firm has executed Sharia-compliant transactions worth more than US$1bn (Dh3.67bn).
The firm developed and provided regional banks such as National Commercial Bank, Dubai Islamic Bank and Banque Saudi Fransi with funds across asset classes including private equity, property and trade finance. It signed a partnership with the Saudi Arabian wealth management company Arbah Capital in April 2008 to provide Saudi institutional investors with Sharia-compliant investment products. No one was available for comment at Tabarak.