UAE's Sorouh announces merger with Aldar
DUBAI Jan 21 (Reuters) - Abu Dhabi's biggest property firms, Aldar Properties and Sorouh Real Estate , plan to merge in a share swap, Sorouh announced on Monday.
Sorouh shareholders would receive 1.288 Aldar shares for every share in Sorouh, the company said. Sorouh would be delisted on the effective date of the merger.
The two companies' boards of directors have unanimously voted to recommend the merger to shareholders, Sorouh said.
Sorouh also said the Abu Dhabi government would pay it 3.2 billion dirhams ($870 million) in exchange for some infrastructure assets and units in Sorouh's The Gate development.
With the support of the Abu Dhabi government, which owns a major stake in Aldar, managements of the two companies had held discussions for nearly a year on asset valuations, financial terms and the new management structure.
The merger could help to stabilise the real estate market by ensuring better coordination of new property developments.
Shares in Aldar and Sorouh have more than doubled in the last one year in anticipation of the merger. (Reporting by Dinesh Nair; Editing by Andrew Torchia)
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