UAE jeweller Damas hires Nomura for deal

UAE jeweller Damas hires Nomura for deal

UAE jeweller Damas International has appointed Japan's Nomura to advise it on a potential offer from Qatari conglomerate Mannai Corp, three sources familiar with the matter said on Wednesday.

February 8, 2012 12:42 by Reuters

Mannai, whose operations span the oil and gas, automotive, travel and logistics sectors, last month said it had secured commitments from shareholders, including the key Abdullah brothers, to buy 58.8 percent of Damas at 45 U.S. cents a share.

At that price, an offer would value Damas at around $445 million, according to Reuters data. The stock, trading at 36 cents on Wednesday, has surged since the news of deal talk on Jan. 4, gaining 63 percent year-to-date.

Mannai has until April 30 to make an offer to all the shareholders.

The Abdullah brothers have been sidelined from the jeweller they helped found and which has been forced to restructure $872 million in debt. A 2010 inquiry found that the brothers owed the jeweller $167.2 million, including $70 million worth of gold.

The sources said on Wednesday the brothers were being advised by PricewaterhouseCoopers, while Doha-based Mannai is being advised on financial due diligence by consultant KPMG while Clifford Chance is handling legal issues.

The sources declined to be identified as the matter has not been made public yet. Damas Chief Executive Anan Fakhreddin and Mannai officials declined to comment. One Abdullah brother referred all queries to Damas.

After Damas 2008 initial public offering, the Abdullah brothers owned between 51 percent and 53.1 percent combined, according to bourse data.

It was not clear if the Abdullah brothers, Tawfique, Tawhid and Tamjid, still own that much of the company.

Mannai said in January that 37 percent of commitments came from the Abdullah brothers and 21.8 percent from other unnamed shareholders.

Any deal is still far from being completed, one of the sources said.

“They have to take into account the interest of Damas’ minority shareholders. It’s far from done for now and there is a lot of uncertainty involved,” the source said.

For Mannai, the deal would be its second buy in the UAE after it snapped up a 35-percent stake in Axiom Telecom in 2011. (Editing by Amran Abocar and Erica Billingham)