Dubai-based leading property developer Emaar said that its shareholders had given the company the go-ahead for issuance of $500 million convertible notes.

The convertible notes, due in 2015, are intended to contribute to the conversion of Emaar’s short term liabilities into long term debt, said a top company official after the company's extraordinary general meeting held in Dubai on Monday.

“The approval of the $500 million convertible notes issue will further strengthen our ability to expand to key geographic markets and develop the fast-emerging role of our business subsidiaries,' remarked Mohamed Alabbar, chairman of Emaar.

The convertible notes had received overwhelming response from investors with demand in excess of $3 billion, he added.

'The convertible notes issue enhances Emaar’s reputation, being the first real estate company in the region to issue a good-sized capital market instrument resulting in improved shareholders’ value and increased confidence amongst lending banks and rating agencies,' Alabbar remarked.

Emaar, he said, will make an application for the convertible notes to be listed on the Luxembourg Stock Exchange and to be admitted to trading on the Euro MTF market. The settlement is expected to take place on December 20, he added.

JP Morgan, The Royal Bank of Scotland and Standard Chartered Bank are acting as joint bookrunners for the offering.

“We are thankful to our shareholders for their trust in our growth strategies aimed at adding long-term and sustained value. Emaar has successfully addressed the challenges of the global financial slowdown, and in this new era of growth, our focus will be on delivering world-class property assets,” said Alabbar.

According to him, the EGM has also authorised the hike in capital which may be required from time to time in connection with any conversion of the convertible notes into shares in Emaar and to authorise certain amendments to the Articles of Association of Emaar.

Emaar had recently announced that its net operating profit for the third quarter had hit Dh2.34 billion ($638 million) and a revenue of Dh8.32 billion ($2.26 billion) during the first nine months of 2010.-TradeArabia News Service