By Stefania Bianchi
Of ZAWYA DOW JONES
DUBAI (Zawya Dow Jones)--Emaar Properties PJSC (EMAAR.DFM), the Middle East's largest developer, is in talks to merge with three state-controlled property firms due to the ongoing global financial crisis and a sharp downturn in the emirate's property market.
Dubai-based Emaar may merge with Dubai Properties LLC, Sama Dubai LLC and Tatweer LLC, units of Dubai Holding LLC, the conglomerate controlled by Dubai's ruler, the companies said in a joint emailed statement Friday.
"Consolidating these three companies with Emaar is a natural progression in the evolution of the Dubai real estate landscape, providing benefits to all stakeholders," Dubai Holding Chairman Mohammad Al Gergawi said.
The global financial crisis has taken its toll on Dubai's once-booming property sector and developers such as Emaar. The slump has so far wiped an estimated 50% off Dubai prices since their peak in August 2008, according to Deutsche Bank (DB), hurting Emaar's property sales and earnings.
In April, the developer posted a 74% fall in first-quarter earnings due to lower unit deliveries and a fall in sales.
Emaar Chairman Mohammad Al Abbar Friday said "there could be exceptional synergies between Emaar and Dubai Holdings' key real estate businesses."
An Emaar spokesperson declined to comment to further on the proposed merger when called by Zawya Dow Jones.
By Stefania Bianchi, Dow Jones Newswires; +971 4 3644967; stefania.bianchi@dowjones.com
Copyright (c) 2009 Dow Jones & Co.