Abu Dhabi’s Eshraq Investments in ‘final stage’ to buy Goldilocks fund

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Abu Dhabi-based Eshraq Investments is set to complete the acquisition of Goldilocks Fund through the issuance of new shares, as the company seeks to increase profitability and drive growth.

Eshraq is in the process of reducing the share capital to 1.427 billion dirhams ($389 million) from 2.325 billion dirhams to compensate for accumulated losses and is also working on the subsequent capital increase in exchange for the acquisition, it said. he said in a statement Monday.

“We are working diligently to complete the acquisition of the Goldilocks Fund,” said Jassim Alseddiqi, Chairman of Eshraq.

“As mandated by our shareholders, we have set the wheels in motion to strengthen the company’s financial performance and improve operational efficiency.”

In March, Eshraq announced its intention to acquire 100% of Goldilocks Investment Company in order to increase its assets to more than 3.8 billion dirhams.

As part of the transaction, Eshraq will issue new shares to Goldilocks investors in exchange for their shares in the investment fund, which is managed by Shuaa GMC, a unit of Dubai-based investment bank Shuaa Capital, he said at the time.

“We are optimistic that this acquisition will accelerate future growth opportunities and create long-term value for our shareholders,” Alseddiqi said Monday.

Goldilocks, domiciled in the Abu Dhabi global market, holds investments in a number of blue chip companies in the Gulf region, including Dana Gas, GFH Financial Group, Salama and Takaful Emarat.

The fund also invests in companies such as music streaming platform Anghami, India’s biggest unicorn EdTech Byju’s, Swiss pharmaceutical company SkyCell and the United Arab Emirates’ Stanford Marine Group.

Eshraq, which owns a portfolio of residential, hotel and other real estate projects, posted a loss in the second quarter of 2022 as operating expenses as well as financial expenses increased, despite an increase in revenue from commercial operations.

The company recorded a loss of Dh7 million in the three months to the end of June, it said in a statement on the Abu Dhabi Stock Exchange, where its shares are traded.

Direct operating expenses during the period jumped 78% to MAD 4.27 million, while financial expenses more than doubled to MAD 2.57 million.

Revenue from commercial operations increased by 90% to reach MAD 9.28 million.

For the six months ending June, the company reported net profit of 7.29 million dirhams, down 59% year-on-year, amid operating expenses and financial charges higher, he said.

Updated: July 25, 2022, 09:21

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