This is a great milestone in our turnaround journey, said Wael Allan, CEO, Drake & Scull International, at a press briefing in Dubai on 18 June. Tabarak Investment is well known in the business. It has great local and regional links and with their commitment to the turnaround of DSI I strongly believe the company will get out of its current financial difficulties.
DSI is also making progress with its capital restructuring plan that will inject more cash into the business.
It has received instruction from the Securities and Commodities Authority (SCA) to proceed with the final regulatory preparations in order to fulfil the approval requirements and to initiate the 75 per cent capital reduction.
The first phase of the capital reduction plan is expected to be completed within six to seven weeks. Once the first phase is complete, the company will begin with the second phase that involves a AED500m ($136m) capital increase with Tabarak Investment.
DSI says the initial projected timeline of the capital restructuring has been deferred by a period of one month and it now expects to complete the plan by the end of the third quarter this year.
The company also said that it continues cost base to reduce overhead and improve its bottom line performance. It has also made a series of key management appointments including the appointment of Feras Kalthoum as acting chief financial officer of the group.
DSI has a backlog of work worth about AED8bn and is expecting three new contract awards in the near future. One is a waste water treatment plant, the other two are deals for mechanical, electrical and plumbing (MEP) work in Dubai.
Another possible contract award is for work on Mecca metro. DSI is part of a consortium that was shortlisted for work on the project in 2015, and there is speculation that the contract could be awarded in the fourth quarter of this year or in the first quarter of 2018.