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Former Drake & Scull executives lose appeal in Dubai court

An appeal against construction company Drake & Scull International was rejected by the Dubai Court of Cassation leaving former executives facing substantial damages Shutterstock
An appeal against construction company Drake & Scull International was rejected by the Dubai Court of Cassation leaving former executives facing substantial damages
  • Significant legal victory
  • Turning point for company
  • Renewed focus on growth

UAE-based Drake & Scull International (DSI) has claimed a pivotal legal victory after an appeal from former executives of the company was thrown out.

Ex-CEO Khaldoun Rashid Tabari and ex-executive Saleh Muradweij were previously ordered to pay almost AED152 million ($41 million) as compensation “for the material and moral damages suffered by the company”.

The two appealed the decision, but a note to the Dubai Financial Market confirmed that it had been rejected by the Dubai Court of Cassation.

“This final judgment not only reaffirms DSI’s commitment to protecting its interests and shareholders’ value but also marks a turning point for the company,” DSI said in a statement.

The judgment also includes five percent annual interest until the full payment is made.

The note added that DSI has already started the process of recovering the amount due, including securing attachments on the defendants’ assets and further measures by the Abu Dhabi Public Funds Prosecution, without giving more detail.

“With this matter resolved, DSI is eager to focus its efforts on strengthening operations, pursuing new projects, and delivering value to its shareholders,” it said.

Shares in the construction engineering company resumed trading in May last year following a six-year suspension after losses exceeded 75 percent of its capital.

Creditors and shareholders approved a restructuring plan last April in a legal battle that almost resulted in DSI being liquidated.

The plan included the write-off of 90 percent of debts while the remaining 10 percent would be funnelled into a sukuk, or sharia-compliant bond.

In its third-quarter results DSI announced profits of AED5.9 million ($1.6 million), a significant swing from a net loss of AED34.9 million ($9.5 million) in the same period last year. Revenues in the third quarter reached AED21.5 million ($5.8 million), up 13 percent from 2023.

Former CEO Muin Al Saleh was reappointed into the role in November last year.

Shares in DSI were up 0.5 percent at AED0.362 at market close on Wednesday.