Mazaya revives First Dubai takeover plans

Kuwait's Al Mazaya Holding <MAZA.KW> will go ahead with plans to increase its stake in First Dubai Real Estate Development after scrapping the proposal last year.

Mazaya's board has approved plans to acquire at least 11 percent and at most 36 percent of First Dubai, Mazaya said in a statement on the Kuwaiti bourse website on Sunday.

"The board has recommended that the acquisition process takes place through buying shares of First Dubai...from (First Dubai's) shareholders, in return for the shareholders who sold their shares to use the returns in subscribing in Mazaya's capital increase," Mazaya said.

The developer which currently owns a 64 percent stake in First Dubai, said the takeover will increase the firm's capital adequacy ratio and lower its debt.

For the transaction, Mazaya's share will be valued at 127 fils, while First Dubai's share will be valued at 46 fils, the firm said. There are 1,000 fils to the dinar.

Mazaya's shares were down more than 7 percent after the news, trading at 128 fils per share on the Kuwaiti bourse.

Last year, Mazaya said that it was not going ahead with a full takeover plan of First Dubai because the benefit of the acquisition was marginal.

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