Dubai, UAE – The proposed acquisition of DAMAC Properties by its founder, Hussain Sajwani, through Maple Invest, has drawn scrutiny from financial experts and investors, raising questions about fairness for minority shareholders.
On June 9, 2021, Maple Invest offered to acquire 100% of DAMAC’s capital at AED 1.30 per share, valuing the deal at approximately $595 million (AED 2.2 billion). Sajwani, who owns 72.2% of the company, also intends to acquire at least 91% to exercise a forced buyout of remaining minority stakes. If successful, DAMAC would be delisted from the Dubai Financial Market, where it has been listed since 2015.
Experts voice concern
- Khaled Al-Raisi, real estate investor, said the offer leaves minority shareholders with little choice, potentially forcing sales at unfair prices.
- Waddah Al-Taha, financial analyst, criticized the appointment of DAMAC’s legal and financial advisors as lacking independence, since they are selected internally rather than by a third-party regulator.
- Muhammad Ali Yassin of Al Dhabi Capital noted that while a financial and legal report will be issued, it is unlikely to oppose the transaction, given Sajwani’s majority control.
Ziad Makhzoumi, CEO of Prime Strategic Consulting, emphasized that while the acquisition follows legal procedures, it is not “merciful” to minority shareholders, highlighting the risks of a forced buyout under majority ownership.
DAMAC’s recent performance
- Net loss of AED 1 billion ($272 million) in 2020, compared to AED 37 million ($10 million) in 2019
- Q1 2021 losses: AED 189.6 million ($51.5 million)
- Projects include the Trump-branded golf course in Dubai and Nine Elms Tower in London
- 33,000 homes built, with another 33,000 under construction
Sajwani, whose real-time net worth is $2.5 billion, resigned as CEO following the acquisition bid to avoid formal conflict-of-interest claims, but his majority ownership gives him effective control over the transaction.
Bottom line: While the acquisition is legally compliant, analysts warn that minority shareholders face potential losses and limited recourse, raising ongoing debates about corporate governance and transparency in Dubai’s real estate sector.
