Amlak Finance's Strategic Asset Sale Plan
Amlak Finance PJSC is taking decisive steps to address its accumulated losses through strategic asset sales and financial restructuring.
Summary
Amlak Finance PJSC plans to sell assets and restructure its finances to address accumulated losses, aiming for a stronger financial position by 2026.
Amlak Finance PJSC, a prominent player in the UAE's finance sector, has recently announced a strategic plan to address its accumulated losses, which currently stand at AED 513 million, representing 34% of its paid-up capital. The company's accumulated losses were primarily due to the fair value loss of investment properties, which have seen a significant reduction from AED 2.3 billion in 2020 to AED 258 million by the end of 2023.
In a move to enhance operational flexibility and pursue growth opportunities, Amlak has commenced negotiations with its financiers to exit the Common Terms Agreement. This decision is pivotal as it allows the company to realign its financial strategy and focus on core operations. The successful negotiation has led to a repayment agreement, under which Amlak will settle its outstanding obligations by 2026 through the planned sale of certain assets.
During the General Assemblies held in March and April 2025, Amlak obtained shareholder approval to proceed with the sale of some investment properties and investments located outside the UAE. This strategic divestment is expected to bolster the company's efforts to address its accumulated losses and strengthen its financial position.
Given the company's proactive approach in reducing its debt burden and focusing on core business operations, the future outlook for Amlak Finance appears optimistic. The strategic asset sale and financial restructuring are likely to enhance the company's stability and provide a platform for future growth.
For investors, the current scenario presents a unique opportunity. With Amlak's strategic initiatives underway and a clear plan to address financial challenges, holding the investment could be beneficial as the company is poised to improve its financial health and potentially increase shareholder value in the long term.
Source
Summary
The document outlines that Amlak Finance PJSC has prepared a report in compliance with the SCA Board of Directors' Decision No. (32/R.M.) of 2019, which requires listed companies with accumulated losses of 20% or more of their paid-up capital to disclose relevant information. As of Q1 2025, Amlak's accumulated losses amount to AED 513 million, representing 34% of its paid-up capital. These losses primarily stem from the fair value loss of investment properties, which have been reduced from AED 2.3 billion in 2020 to AED 258 million in 2023. In 2024 and early 2025, losses from foreign currency translation reserves were reclassified to accumulated losses due to repatriation of funds from its Egyptian subsidiary to the UAE. Amlak is negotiating with financiers to exit the Common Terms Agreement to enhance operational flexibility and pursue growth opportunities. A repayment agreement has been reached, aiming to settle outstanding obligations by 2026 through asset sales. Shareholders approved this strategy in March and April 2025, allowing the sale of certain investment properties and investments outside the UAE. These actions are intended to address accumulated losses and strengthen Amlak's financial position.
