Dubai builder Arabtec names new chairman

The board of Dubai builder Arabtec has elected Abu Dhabi businessman Mohamed Thani Murshed Ghannam Al Rumaithi as its new chairman in a move that analysts said could unnerve investors who have witnessed much turmoil in recent months.

Rumaithi, who is also chairman of the Abu Dhabi Chamber of Commerce and Industry, replaces Khadem Abdulla Al Qubaisi, who was not nominated for renewed board membership last month.

Arabtec shares were trading 1.1 per cent lower at 0800 GMT, against a 0.4 per cent gain for the wider Dubai market.

The departure of Qubaisi, also ousted as chairman of Abu Dhabi state-owned International Petroleum Investment Company last month, is the latest in a series of senior management changes at the Dubai-based contractor.

Hasan Ismaik resigned as chief executive last June after a tumultuous six-week power struggle between the Jordanian and Arabtec's major shareholder Aabar Investments. Ismaik's departure led to the exit of a number of other senior management figures.

"The new chief has to work out a strategy for the company and there might be changes. This is unsettling for investors in that stock," said Sanyalaksna Manibhandu, head of research at NBAD Securities.

"Investors are looking for continuity and are not getting it," he said, adding that one positive is that Aabar remains a major shareholder in Arabtec.

The appointment of a new chairman could also be the beginning of a new style of management at Arabtec, said a source familiar with Abu Dhabi's thinking.

"This management will be different and will in the first few months review the company's projects, its liabilities, cash flow and put together a plan to stabilise the company," he said, declining to be named.

Arabtec has major projects on hand, including a $36.7 billion project to build one million housing units in Egypt, as well as projects in Saudi Arabia and the UAE. The company posted a net loss of $25.7 million in the fourth quarter of last year, with high costs weighing on its bottom line.

Rumaithi's family business, Thani Murshid Group, is the Abu Dhabi partner of consumer goods conglomerate Unilever  . He is also chairman of National Marine Dredging Co .

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