Fund managers want Aldar and Sorouh, Abu Dhabi's two biggest developers, to clarify the status of their proposed US$15 billion merger.
Aldar and Sorouh clarity call
Fund managers want Abu Dhabi's two biggest developers to clarify the status of their proposed US$15 billion (Dh55.09bn) merger.
The calls came yesterday after shares of both companies rose more than 10 per cent on unconfirmed reports they had hired investment banks to advise on a deal.
"They haven't made an announcement as to the conclusion of the study and it would be nice to have some clarity," said Haissam Arabi, the chief executive of the asset manager Gulfmena Investments in Dubai.
Aldar's shares rose 3.7 per cent to Dh1.11 yesterday, while Sorouh's shares rose 3.8 per cent to Dh1.07.
The share prices began to move as various media published unsourced reports claiming the companies had hired Goldman Sachs and other investment banks to advise on a deal.
It is understood, however, that talks are ongoing between the two developers and several banks but no decisions have been made. Spokesmen for Aldar and Sorouh declined to comment.
"The market is pricing in that this deal is going through," Mr Arabi said. "We need information to make sure we are not moving ahead of ourselves. Has the study been concluded or not? They need to come out publicly and say something to that effect."
Aldar shares crept 1 per cent higher on Thursday, 3 per cent on Sunday and 4.9 per cent higher on Monday, bringing its total gains to 12.6 per cent at a time where overall markets were flat or volatile amid investor worries over the euro-zone debt crisis. Sorouh's shares rose 2 per cent, 5.1 per cent, and 3.8 per cent in the same period, bringing its total gains to 10.9 per cent.
"The news leaked was so short and did not provide any additional information, keeping the door wide open for speculation and guessing," said Wadah Al Taha, the chief investment officer at Al Zarooni Group.
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