View on Aabar after Artc takeover

[fayesloan]

Partially in reply to *Maha*
I cannot speculate on the health of Artc, but it seems to me that big Artc investors have been bailed out, but with an eye to the longterm future. Am I right in believing Aabar believes Artc could be the builder of the Middle East? Aabar may or may not pull this off for its investors but regardless I think this stock, and not Artc, is the correct one to be invested in for the next few years. Artc was a leading and the most high performing stock over 2006 to middle 2008. I don't expect that kind of performance again, but I do with Aabar.
Aabar was very quick out of the bottom in early 2009 and made a good case for being a leading stock until its hesistance in the volatile Q4. Even if UAE stocks decide on average to exceed last year's lows Aabar and a 2-3 others may not, just like Artc did while Emaar and others kept going lower over 2006-2008. If UAE stocks have seen the bottom for the next few years then I want to be in Aabar because it led the move off the bottom. However. the stock is extremely risky because if there is a nasty systemic surprise anytime in the future Aabar's investment portfolio will take a significant hit.
I am buying and forgetting shares of Aabar at market price with up to 2% of my investment capital as a lottery play on UAE markets over the next several years. It could be the next Emaar and Artc and at 2.x billion dollars market cap it could make sense if global stock markets continue the bull run and do not collapse some time in H2 this year.
My position size is small because I'm not interested in risking significant money on this stock over the next few years. It's simply too risky if you believe there are problems ahead in global markets.
The market may take the news about Aabar's investment in the local market as a strong message that Aabar means big business and that's all that matters to me. I will leave it up to members here to discuss the real numbers

[Rashid]

Faye's writing makes lot of sense, despite demonstrated weakness to girl's remarks, e.g. *Maha*.

Arabtec is in weak financial position since long, at least a year and half. Most probably Maydan issue is not resolved yet and won't be finalized soon. Also, it is very much possible Arabtec to not be able to receive owed payments in Dubai for the next few years, if ever... The facts observed during the last year, e.g. frequent change in the percentages and names of the main shareholders, clearly states that company is searching for solutions.

Now, Aabar is completely different story as it is glued (part) to Abu Dhabi (UAE Federal) government. The speed and size of additions to their investment portfolio only during the last one year is incredible. For some reasons the big players have chosen to bet and lift this company. This may not continue indefinitely, but will continue during the next few years.

World markets will stabilize in 2010, in my humble opinion. Aabar's Daimler investment is solid and Germany's economy is the strongest in Europe. Such investments may be doubled or liquidated with the same speed that hey was initiated. Regardless, the foreign investments of Aabar, it seems the stock is fairly safe bet - follow the big boys

[sharewadi]

See also the original Arabtec Aabar topic. It's not clear to me why a second discussion needed to be started on what appears to be essentially the same subject, especially when comments in the original topic are referred to. I will consider merging the two topics (if I can easily) unless there's a good reason to have them separate?
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[sharewadi]

Ok, I think I understand now.

Original topic was about the Aabar (AABAR) takeover of Arabtec (ARTC).

This topic is about how the takeover is going to affect Aabar's shares and Aabar as a company. Not sure there's a huge difference though.
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[Rashid]

Hahahah.., if we can't merge anything else we can merge discussions on the Internet

But to me it seems that the first discussion is speculative - discussing a rumor, while the other aims at evaluating the consequences of a fact. So, Faye's decision to capture the spotlight once again by starting a new topic seems reasonable.

Besides, new discussion will attract extra attention and generate more impressions for the advertisement from the same viewers.

[zayda]

If this deal is through, the losers will be existing ARTC shareholders. But the way Aabar has gone about releasing this information talks volumes about investor relations in UAE.

[Rashid]

With Emaar surrendering it's crown jewel - The Burj, Arabtec accepting offer bellow market price, I wonder who is next... Nakheel is not listed and on standstill...

[MNK]