Tamweel's shareholders have approved delisting the company from the Dubai Financial Market, a little over two years after it was restored to full trading on the emirate's bourse.
The Sharia-compliant mortgage lender, which this year had its Islamic financing assets fall to a five-year low, was taken private by Dubai Islamic Bank (DIB) after a 2011 capital injection from the bank returned it to full trading.
Tamweel's shareholders approved the move at an extraordinary general meeting on Sunday.
"The acquisition of Tamweel will enable DIB to take advantage of the opportunities offered by the recovery and growth of the UAE real estate sector," said Abdulla Al Hamli, the bank's chief executive.
The move comes as banks and finance companies struggle to capitalise on a substantial bounce in UAE property prices, with an influx of cash buyers and a price war on interest rates hampering returns for home lenders. The total stock of outstanding mortgages fell by the most in two years during the first quarter, according to data from the Central Bank, pointing to the third consecutive quarter of declines. DIB believes the current take-off in rents, which rose during the same period by more than any other market worldwide according to Knight Frank, will convince more residents to buy their homes.
"More and more end users are leaning towards owning properties rather than continuing to rent," said Adnan Chilwan, DIB's deputy chief executive.
"Hence this acquisition leaves our business well placed to capitalise on the opportunities the home finance sector presents." Tamweel was restored to trading on the DFM in May 2011 after DIB paid US$102 million to increase its stake in the firm to 58.2 per cent.
This year, DIB said it would take over the remaining shares that it did not already own.
Tamweel had formerly been suspended from trading at the onset of the global financial crisis after an ill-fated merger with Amlak Finance, intended to consolidate the two companies after wholesale funding markets froze up and the two were unable to access fresh sources of capital.
