The share prices of Dubai-based construction firm Arabtec took a 10 per cent beating on Sunday morning after trading resumed following suspension last Thursday.
The share price suffered a maximum 10 per cent drop within 45 minutes of opening.
As a result, the plunge has also dragged the Dubai Financial Market General Index down by 6.12 per cent by Sunday afternoon.
This has come as its second largest stakeholder, Aabar Investments, released a statement on the DFM website before trading commenced neither confirming nor denying reports that they may be increasing shares in Arabtec.
On Thursday rumours had surfaced that government owned Aabar were planning to increase their stake by purchasing some the 28.9 per cent of shares currently owned by former CEO Hasan Ismaik. Nonetheless, having recognised Arabtec’s heavy influence on the DFMGI, regulators promptly stepped-in, suspending the builders’ trading on Thursday until the rumours were clarified.
Early on Sunday, the (non)clarification stated “As a partner committed to and supporting Arabtec, Abaar asserts that it is currently studying a number of strategic options regarding its investments in Arabtec.” The statement also noted that all future discussions on the matter will be conducted in confidentiality.
This latest twist in the Arabtec saga has seemingly only further confused investors at the DFM.
On the contrary, however, as with last week when the DFM only started to pick up by Tuesday, the 6.12 percent drop could simply be an indicator of a poor start the week.
Speaking to AMEinfo , Khalid Mahmoud of Al Fardan Financial Services explained that the poor start “is not only down to Arabtec. The whole market is going through a really slow start.”
Sunday, July 20- 2014 @ 13:54 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.