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Abu Dhabi, UAEFriday 20 July 2018

Dubai's Shuaa Capital joins First Abu Dhabi Bank in reporting Abraaj exposure

Shuaa and its clients have a 3.6% holding in The Abraaj Buyout Fund II, while Ajman Bank is part of a syndicated loan to a firm majority-owned by Abraaj Capital

Arif Naqvi, the founder of Abraaj Capital. Dubai's Shuaa Capital is among a growing list of companies declaring exposure to Abraaj. courtesy World Economic Forum
Arif Naqvi, the founder of Abraaj Capital. Dubai's Shuaa Capital is among a growing list of companies declaring exposure to Abraaj. courtesy World Economic Forum

Shuaa Capital and Ajman Bank joined a growing list of UAE-listed companies with direct or indirect exposure to Abraaj Group, the embattled private equity firm that has been roiled by allegations of misusing investors' funds.

Dubai's Shuaa Capital and its clients hold a 3.6 per cent stake collectively worth $8.83 million (Dh32.5m) in The Abraaj Buyout Fund II, it said in a statement to the Dubai Financial Market, where its shares are traded.

This includes an amount of "$4.9m for Shuaa Capital and $3.92m for Shuaa Capital's clients", the company said in the bourse filing on Wednesday.

Shuaa joins companies such as First Abu Dhabi Bank, Air Arabia and Union Arab Bank in reporting to the market their exposure to Abraaj, which is undergoing a court-supervised restructuring. FAB on Tuesday said it has direct exposure to the buyout firm through a fully secured three-year $21.4m loan maturing in April. Sharjah-based budget airline said last month it has an exposure of $336m to Abraaj through fund portfolios and short-term investments.

Ajman Bank has no direct exposure but was involved in a syndicated funding to Stanford Marine, a company that is 51 per cent owned by Abraaj Capital, it said in a separate statement to the DFM.

Stanford Marine is part of the Stanford Marine Group, a Dubai-based marine business serving the oil and gas industry, according to Abraaj Group's website. The company owns and operates a fleet of more than 40 offshore supply vessels, deployed across the GCC, South-East Asia, and Africa. Abraaj first invested in the company in May 2007.

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Read more:

Dubai Financial Services Authority to investigate Abraaj mismanagement claims

Abraaj founder Naqvi to skip hearing to avoid possible arrest

Abraaj founder Naqvi faces UAE court ruling over bounced cheque

Abraaj restructuring request approved by Cayman Islands court

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Stanford Marine has an outstanding amount of Dh105m for the syndicated loan, according to Ajman Bank. The loan is backed by company's ships as collateral.

Over the last three days a slew of companies listed on Abu Dhabi Securities Exchange and DFM declared their exposure, or lack thereof, to the private equity firm, on the directions of UAE market regulator, Emirates Securities and Commodities Authority.

Emaar Properties, Dubai Islamic Bank, Damac properties, RAK Ceramics, Du and Aramex on Tuesday said they do not have any direct or indirect exposure to Abraaj.

Separately, a Sharjah court case against Abraaj founder Arif Naqvi and another company executive related to issuing a bounced cheque was adjourned again to July 15, Reuters reported on Wednesday.

The criminal case is about a cheque for Dh177.1m, signed by Naqvi and another executive, written out to Hamid Jafar, a founding shareholder in Abraaj. Last week, Mr Naqvi's lawyer told The National that the parties have reached an out-of-court settlement and waiting to sign off on the deal.

The case is the latest twist in a five-month saga involving Dubai-based Abraaj Group, which has been accused of mismanaging investors’ money in a $1 billion healthcare fund. Abraaj has denied the allegations.

The company is undergoing a court-supervised restructuring in the Cayman Islands and last month reached a provisional agreement to sell part of its funds management business to US-based Colony Capital.