Drake & Scull International, a regional leader in engineering and construction services, said it has incurred a net loss of Dh498 million ($135 million) for the third quarter.

Announcing the third quarter results, the leading Dubai builder said the operating loss was attributable to the final phase of the project (close-out and handover) of the company’s legacy projects.

This comes as part of the ongoing restructuring programme which includes the reassessment of all current and legacy projects. Furthermore, in light of this reassessment, several legacy projects which are due to be closed-out and handed-over could lead to further potential losses in the fourth quarter 2018, it stated.

Drake & Scull International also announced the appointment of external restructuring advisors to work with the recently appointed Restructuring Committee on the financial plan to restore operations and stabilise the business.

The company's board had approved the formation of a restructuring committee on October 22, after shareholders had voted by a special resolution early last month at the general assembly to continue operations.

The four-person committee comprises Khamis Buamim, Ahmed Kilani and Obaid Al Marri (all board members) and Yousef Al Mulla, an industry veteran, who has been appointed Group CEO.

Al Mulla joined the company during the third quarter on August 26.

The Dubai builder said the restructuring committee had now formally appointed advisors to work on the development of a new financial restructuring plan to put the company on a strong path to recovery.

Trussbridge Advisory (DIFC) Limited has been appointed financial advisors to the restructuring, while Allen & Overy LLP are the legal advisors; Al Tamimi & Company the regulatory advisors and Deloitte has been appointed to advise on the development of a new and comprehensive business plan.

Concurrently, Drake & Scull International said it is pursuing ongoing measures to accelerate bidding and secure new projects and continues to submit proposals for carefully selected projects, predominantly in the UAE, with several [fully financed] projects due to sign in the coming months.

Notwithstanding its financial situation, Drake & Scull continues to be sought after by developers for high quality and important construction projects, it added.

Unveiling the new plans, Al Mulla said: "The appointment of an experienced restructuring advisory team is an important step as we move forward with our financial and operational restructuring plan."

"The team which is working with our newly-formed restructuring committee, will not shy away from taking the tough decisions necessary to refocus the business and, with support from our many stakeholders, restore the Company to financial health," he stated.

The committee and its strong team of advisors will develop a comprehensive plan that will build on the restructuring and recapitalisation that started last year and continued throughout 2018, said the top official.

The plan will be developed in the best interests of all stakeholders including lenders, suppliers and current and previous employees, he added.-TradeArabia News Service