Union Properties investors seek clarity

Stock’s trading was suspended last week amid intense speculation

Union Properties shareholders will be looking for explanations and a lot more as and when its shares start trading again. It was on Thursday last week that the stock was suspended, setting into motion heavy speculation about the structure of the company’s board of directors and future direction.

Market sources say some sort of update from the company could be issued shortly to the Dubai Financial Market, and that should set in motion the launch of trading activity. The company’s stock has been under pressure and had spent the better part of April the Dh1.01 mark.

It had slipped to a low of 92 fils for this year in late February just days after touching Dh1.15.

The announcement of its 2016 results, which saw profits dropping by half to Dh211.4 million from Dh434.6 million in 2015, did not help either.

More so as most of Dubai’s blue-chip developers came out with a strong set of numbers or managed to hold off a steep decline.

Medium-term plans

“A clarity is needed on Union Properties’ medium term plans on the development side and how it manages to get adequate cash flow for it,” said an industry source. “Of its existing land bank, Union Properties has managed to extract optimum value — but the question is what next.”

Some market sources have speculated that Union Properties could go in for a strategic partner on select projects, much along the lines of what it has been doing with Dubai Investments.