By David French and Praveen Menon
The Al Jaber Group, a family-held conglomerate currently in the midst of a more than $1 billion restructuring, will hire a new chief executive to replace the founder's son in a management reshuffle that recently saw a new finance chief being appointed late last year, three sources told Reuters in late February.
A recruitment firm has been retained to bring in a new CEO, replacing Mohammed al-Jaber, the son of the group's founder and chairman Obaid al-Jaber, two of the sources said, speaking on condition of anonymity. In addition, Richard Hollands was hired in November as chief financial officer from an Emirates airline unit.
"It was presented at one of the earlier creditor meetings that they would be looking to make management changes, including a new CEO," said one source familiar with developments. "A firm has been hired to do this."
An Al Jaber spokesman declined to comment.
A standstill agreement on its debt pile is expected to be signed as soon as early March, the sources said."It's just a case of getting the signatures," a second, banking, source said. A third source said the standstill agreement had been held up because banks were against rolling over the debt at the terms demanded by Al Jaber.
The banks' committee is chaired by the National Bank of Abu Dhabi, and includes Abu Dhabi Commercial Bank, HSBC, RBS, and Union National Bank. The conglomerate, which has operations from construction to aviation and retail, appointed a new chief restructuring officer last year to work with lenders and management on matters related to the rescheduling of its financial debt.
A reorganisation and steering committee has been in place to oversee the restructuring and consists of members from some of Abu Dhabi's top government-related firms and banks. The chairman of Abu Dhabi government-owned Al Hilal Bank, who is an Al Jaber son-in-law, is on the committee in a personal capacity, the source familiar with developments said.
Bankers said asset sales would be a natural expectation under most corporate restructurings but declined to be more specific about Al Jaber's plans. Al Jaber is one of the most prominent family-owned private sector firms in Abu Dhabi, where the acknowledgment of financial difficulties has been minimal, in contrast to neighbouring Dubai, under the spotlight for its debt woes since late 2009.
The emirate was resilient during Dubai's property market collapse but is now showing signs of pressure as a huge supply of high-end homes are expected to come onto the market. Housing prices in Abu Dhabi are seen falling by as much as 11 percent this year, a Reuters poll showed last month.
Across the oil-rich state, which accounts for more than half of the United Arab Emirates' economy, government-backed real estate, commercial and tourism projects, many conceived during the boom years of 2003-2008, are under review and in some cases being delayed or put on hold. Abu Dhabi pushed back the opening of the much talked about local branches of Louvre and Guggenheim art museums earlier this month. Reuters
(Additional reporting by Stanley Carvalho and Rachna Uppal)
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