Arkan Names KPMG as Advisor to Study Emirates Steel Merger
Leading construction and building materials company in the UAE Arkan Building Materials Company has appointed KPMG as independent valuer and White & Case as legal advisor to review the merger offer submitted last month by General Holding Corporation (Senaat), part of ADQ, with its wholly owned subsidiary, Emirates Steel Industries. Arkan said its board of directors will refer to the valuation work of KPMG along with work done by other advisors in assessing the proposed offer before making a recommendation to shareholders.
The key terms of Senaat’s offer are to transfer Emirates Steel to Arkan in consideration of the issuance by Arkan to Senaat of a convertible instrument. Upon closing of the transaction, the convertible instrument would automatically convert into 5.1 billion ordinary shares at a fixed price of AED0.798 per share in Arkan’s capital. When applied to Senaat’s valuation of Emirates Steel, the offer implies an equity value for Arkan of approximately AED1.4 billion. Post completion, Senaat would own 87.5% of the entire issued share capital of the combined group.