Arabtec invests another Dh40m into Target

Arabtec Holding is increasing the paid-up capital of its subsidiary Target Engineering Construction Company from Dh70 million to Dh110m to "help the classification in the capabilities of Target to execute sizable projects certain clients require from contractors", according to a senior official who spoke with Emirates Business.

"Target is bidding for projects in the UAE and countries and markets outside the UAE, specifically in oil and gas and infrastructure projects that they are interested in, to help the classification in the capabilities of Target to execute sizable projects," said Ziad Makhzoumi, Chief Financial Officer at Arabtec Holding.

"Some big clients in oil and gas look at the paid-up capital of the company and not only at the balance sheet, which is very healthy in the case of Target. In order to help the classification in the capabilities of Target to execute sizable projects, certain clients require from contractors, a minimum paid-up capital for their companies when bidding for projects of a certain size. So we will look at increasing the paid-up capital to Dh110m from the current Dh70m by capitalising some of the retained earnings."

On May 2, Arabtec Holding, the biggest construction company in the UAE, had said that the board would discuss a capital increase for Target, according to a statement on the Dubai bourse.

On March 29, Target was awarded two engineering, construction and commissioning projects in Abu Dhabi with a total value of Dh835m. The Ayman Taji, CEO of Target, was quoted as saying: "The two new projects enforce our strategy to position Target as a leading company in the construction sector and especially in marine engineering and construction projects. We are looking for future collaboration on other projects with Takreer and Petrofac GS."