Jeweller Damas takes controlling stake in Saudi joint
Damas takes 98 pct stake in Saudi joint venture; Cost of acquisition undisclosed; Damas reached debt deal with lenders in March
April 26, 2011 4:31
Jeweller Damas International, which recently reached an agreement with its lenders to restructure $872 million in debt, has acquired a controlling stake in its Saudi Arabian joint venture, Damas Saudi Arabia Company Ltd.
Damas acquired 49 percent of the share capital of its existing joint venture in Saudi Arabia, taking its stake to 98 percent with full control of the company, the firm said in a statement on Monday.
The statement did not disclose the value of the acquisition.
“The Saudi market is a core market for Damas and this acquisition will help provide a platform for us to service this key market more fully,” Anan Fakhreddin, Damas International’s chief executive, said in the statement.
The jeweller has been stung by controversy ever since allegations of financial fraud by the company’s founders, the Abdullah brothers.
An inquiry last year showed that the Abdullah brothers owed the company a total of 614 million dirhams ($167.2 million), that included 256 million dirhams worth of gold that the three brothers had withdrawn from the company.
Last month, Fakhreddin said the company had reached an agreement with its lenders on debt worth $872 million.
Damas is primarily involved in the business of trading in gold and gold jewellery, diamond jewellery, pearls, watches, silver and precious stones on a wholesale and retail basis.
(Reporting by Rachna Uppal; Editing by Amran Abocar)