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UAE’s Arkan Building Materials Co has completed its merger with Emirates Steel Industries, after receiving shareholder and regulatory approvals.
The merger was first announced in May this year when ADX-listed Arkan said its board of directors has received an offer to merge the two firms in exchange for the issuance of an instrument that would automatically convert into approximately 5.1 billion ordinary shares in Arkan’s capital.
Arkan is 51 percent owned by Senaat Holding Company, which is backed by state-owned holding company ADQ. Senaat also wholly owns Emirates Steel. Following the merger, Senaat will potentially own 87.5 percent of the combined entity’s share capital.
Senaat is an industrial conglomerate that manages billions of dirhams in assets, operating in various industries, including metals, oil, construction and food and beverage manufacturing.
The merged entity will have total assets worth 13 billion dirhams ($3.54 billion).
The transaction provides significant revenue diversification for the combined group and marks “the first time that investors have access to a steel producer on a UAE public market,” Arkan said in a statement on Wednesday.
(Reporting by Brinda Darasha; editing by Seban Scaria)
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