(Adds analyst estimates, context, audited Q4 2015 calculation)
By Hadeel Al Sayegh
DUBAI Feb 13 Dubai contractor Arabtec
reported a wider fourth-quarter loss on Monday, and its board
said it was seeking shareholder approval for a 1.5 billion
dirhams ($408.4 million) rights issue to recapitalise the
Shares of Arabtec plummeted almost 10 percent at the open
after the results were disclosed to the market.
The builder is working with boutique investment bank Moelis
to study options for the company's capital structure, sources
familiar with the matter told Reuters on Sunday.
Arabtec made a net loss of 2.95 billion dirhams ($803.4
million) in the three months to Dec. 31, Reuters calculated
based on financial statements in lieu of a quarterly breakdown.
This compares with a net loss of 403.74 million dirhams in
the corresponding period of 2015, according to Reuters'
calculations of Arabtec's audited financial statements.
EFG Hermes had forecast Arabtec would make a quarterly net
loss of 272.8 million dirhams.
The company reported a net loss attributable to the
shareholders of its parent of 3.41 billion dirhams for the year
2016, compared with a loss of 2.35 billion the year earlier.
The company also said its board approved a proposed capital
restructuring plan and a 1.5 billion dirhams rights issue, which
would require investor consent at the next general meeting.
Arabtec has been struggling for more than two years because
of a sagging construction market, as well as internal strife
among shareholders and a number of senior management changes.
In an effort to try to turnaround its fortunes, the company
in November appointed industry veteran Hamish Tyrwhitt as its
The appointment was welcomed by shareholders who in June
agreed to use 1 billion dirhams of the company's statutory
reserves to wipe out some of Arabtec's accumulated losses.
Reuters reported in April that Arabtec had hired AlixPartners to
help draw up a plan to revise its business and capital
AlixPartners' contract to reduce overheads at Arabtec was
completed at the end of last year, the sources told Reuters on
Sunday, declining to be named as the information is not public.
($1 = 3.6729 UAE dirham)
(Editing by William Maclean)