Boardroom upheaval at Union Properties

Union Properties is to host an emergency shareholder meeting later this month to approve the appointment of a new chairman and vice-chairman after an apparent boardroom tussle.

The company held its annual general meeting (AGM) last Wednesday evening at which shareholders approved the continuation of its seven-strong board of directors, including its chairman, Khalid bin Kalban.

But at a board meeting immediately after the AGM, Union Properties said that Nasser bin Yousef was elected as chairman by a majority vote of the board, with Hamad Abdulla Al Mass elected as vice-chairman. The company said that three directors, including Mr bin Kalban, Ali Al Fardan and Mohamed Al Ketbi, all resigned from their posts. However, Mr bin Kalban told The National on Monday: “I, and the other two directors, haven’t resigned.”

The company’s shares were suspended on Thursday following a complaint to the Securities and Commodities Authority (SCA) by Mr bin Kalban and the two other directors, stating a denial that they had resigned.

There had already been speculation about the company and Mr bin Kalban’s own position. But when asked about this on Saturday, he said: “There are board changes, but I am there. As far as the election and the AGM, everything was OK. There were no issues.”

The market regulator subsequently readmitted the shares for trading on Sunday afternoon.

Yesterday, the company’s shares increased in value by 4 per cent, closing at Dh1.06 on the DFM.

Ahmad Al Marri, the general manager of Union Properties, said at a news conference held on Monday that the decision by the SCA to readmit the shares for trading meant that the matter is now closed.

He said that an extraordinary general meeting (EGM) will be convened on May 25 to vote on replacements for the directors that the company insist have resigned. Speaking to The National after the news conference, Mr Al Marri said: “It means that everything has been done and investigated, and now we are calling for another [shareholders’ meeting].

“They have done their investigation, they asked the board of directors to provide them the documentation that says yes, they [the outgoing directors] have resigned.”

Mr bin Kalban said on Monday that he was unable to comment further on the matter because it is in the hands of the SCA.

On Monday, the Union Properties website listed Mr bin Yousef as chairman and the previous link to Mr bin Kalban’s profile could no longer be accessed.

He had been appointed chairman of the developer in 2008 by its largest shareholder, the lender Emirates NBD, just before the global credit crunch and guided the company through its own crisis, renegotiating with its creditors over its US$2 billion debt pile.

Union Properties declared a pre-tax profit of Dh211.4 million for 2016, which was a 51 per cent decline on the Dh434.6m achieved in 2015, and revenue was 22 per cent lower at Dh1.13bn. However, this was partly due to a gain on the valuation of its property of Dh122m last year, compared with almost Dh670m in 2015.

Mr Al Marri said the new board would meet management on Thursday to discuss strategy and outline a plan for the next 12 months. This will include bringing forward three potential new projects in Motor City.

“One of them, we have the land already. After six months, we will start,” he said.

Union Properties is also meant to be pursuing a stake sale in Emicool – a district cooling company that it owns jointly with Dubai Investments, of which the ousted chairman, Mr bin Kalban, is the chief executive and managing director. Both companies are due to sell 15 per cent each of the business in a pre-IPO deal ahead of a flotation due to take place by the end of this year.

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