Job losses continue in Dubai. An interesting view expressed by the group CEO in this article that lays off = substantial achievement.
Source: ArabianBusinss.com 15 October 2009
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25 percent of Dubai World's UAE staff have been cut as part of a restructuring process.Dubai World said on Thursday that 25 percent of its UAE workforce has been cut as part of a major restructuring of the company aimed at saving $800m.
In all, about 15 percent of its employees worldwide have been axed as part of the plan to create "significant cost savings and increased efficiency".
Company chiefs said Dubai World's businesses were now well prepared to "thrive in both the current climate and the still uncertain future environment".
The reorganisation builds on the changes announced in June, when management of Jumeirah Golf Estates, Jumeirah Lakes Towers and the real estate activities of Dubai Maritime City moved to Dubai World real estate company Nakheel.
The company is scheduled to benefit by more than $800m in operating savings over the next three years, it said in a statement.
The total workforce managed by Dubai World companies globally has been reduced by about 15 percent to less than 70,000.
However, the reduction is around 25 percent in the UAE, largely as a result of the downturn in the real estate market in the region, but did not give an exact number.
Dubai World chairman Sultan Ahmed Bin Sulayem said: “Whilst the challenges we faced are not unique, with no global entity immune from the pressures of the world wide recession, we are confident that Dubai World and its subsidiaries are appropriately focused and properly structured to embrace the new global reality.
“Our diverse portfolio of assets around the world, together with our significant interests here in Dubai, provides us with an exciting and compelling future.
"With the reorganisation, the Group enters this next vital phase of our evolution better able to withstand all economic eventualities. Dubai World remains a testament to the vision of our government and the UAE as a whole, today and tomorrow.”
Group chief executive officer of Dubai World Jamal Majid Bin Thaniah said: “This organisational restructuring is a substantial achievement and I would like to thank all our employees and our customers for their continued loyalty through these difficult times.”
Showing posts with label Dubai World. Show all posts
Showing posts with label Dubai World. Show all posts
Friday, 16 October 2009
Monday, 14 September 2009
Dubai wealth fund under stress
Source:Al Jazeera and agencies=====================
Istithmar World, the sovereign wealth fund of Dubai, is reported to be considering a halt to investments as it undertakes an overhaul of its operations.
Istithmar is one of the flagship companies of state-owned Dubai World, whose real-estate unit Nakheel is seeking to refinance $3.52bn Islamic bonds maturing in December.
The overhaul could lead to the sale of the fund or its assets, the news agency Bloomberg said.
Istithmar, run by David Jackson, said recently that John Amato and Felix Herlihy, its co-chief investment officers, were leaving the firm to explore other opportunities.
Jackson's job is also under review, the Bloomberg news agency said quoting people.
However, Dubai World said on Friday that Jackson would continue to lead the company.
"Reports that ... David Jackson had left the company were incorrect," a company spokesperson said in an e-mailed statement.
Reversal of fortune
A restructuring by Istithmar and its parent Dubai World may mark the most public reversal of fortune for a state-controlled investment firm since global credit markets seized up in 2007.
Dubai World has $59bn of liabilities, a large proportion of the Gulf emirate's total debt.
The company, which owns Barneys New York, hired an advisory firm in August to help it explore options to shore up the US luxury chain's financial position.
Dubai World is also trying to persuade bank creditors to restructure up to $12bn of its loans, an indication that the emirate is starting to grapple with the challenge posed by its $80bn-plus debt pile.
Bankers close to the talks say Dubai World is gauging interest from about 10 banks for a restructuring of outstanding syndicated debt and bilateral loans for the holding company as well as Nakheel and Istithmar.
Recovery signs
Hit hard by the credit crisis, Dubai, one of the UAE's seven emirates, is showing signs of recovery on the back of global economic optimism.
However, restructuring Dubai's government-linked debts remains a top priority as the government seeks to assure a rebound for its trade, tourism and services-focused economy and recover from the precipitous property crash.
Speaking to Al Jazeera on Sunday, Robin Amlot, managing editor of CPI Financial, based in the emirate, said: "Dubai is not oil-rich. It's a service economy. And as all service economies it has suffered in the global retrenchment that we have seen in the last two years.
"And what has happened with Istithmar World is an extension of that.
"They invested in banks, yacht marinas, Las Vegas property, Barneys high-end fashion in New York - all of which have been vulnerable areas.
"We are not staring into the abyss anymore. Business is still carrying on, companies are starting to hire again. The thought that we were going to fall into a black hole is falling away."
Thursday, 9 July 2009
Nakheel cuts 400 more jobs
From The National 8 July 09
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Nakheel, a property developer owned by Dubai World, has made about 400 more staff redundant as the company continues an overhaul brought on by the downturn in the property sector.
The redundancies were staggered over the past two weeks and are on top of the 500 jobs that were cut last December, a source close to the company said.
"We were given a redundancy package of six months' pay" one former staff member who was laid off last week said.
The economic downturn has battered nearly every Dubai developer, with property prices and sales falling sharply. Developers, who were mostly reliant on off-plan sales to finance the construction of their projects, have struggled to collect payments, leading to rising defaults, while payments to suppliers have been delayed.
Nakheel yesterday confirmed the redundancies as the company continues to readjust its current business objectives to match supply and demand in the most effective way, but declined to say how many jobs have been cut.
Nakheel recently merged a number of its business units, which are now undergoing resource restructuring to ensure efficiency and optimisation of skill and talent, the company said.
The source said the bulk of the cutbacks affected the company’s asset management and design (NAMAD) division, a unit that was formed only in February after the the design group and universe master planning divisions were merged. The source said Imdaad, a facilities management (FM) firm also owned by Dubai World, would now manage most of the infrastructure and facilities across Nakheel's projects.
But Nakheel denied this, saying: NAMAD's facilities management team is functioning as usual. Imdaad has been providing FM services to Nakheel as a service provider in various communities following the usual practices of engaging a service provider.
The redundancies come after at least five years of expansion, during which Nakheel took on staff for large salaries in order to resource its ambitious projects, which include the Palm island trilogy, The World and Waterfront.
It was a time when all Dubai developers scrambled to attract staff, with poaching being the norm and salaries being high.
A junior level staff member, for example, could earn about Dh80,000 (US$21,780) a month with a company such as Nakheel, according to Simon Hobart, the managing director of the recruitment firm Millennium Solutions.
Everyone was earning big money in the first six to eight months of last year, with the problems associated with that now being enormous, Mr Hobart said. Nakheel was paying people too much, it all went a bit mad. Some of these guys were only 24 or 25 years old. Today, they’d get a third of what they were on.
While there is no official figure on how many jobs have been lost in the property sector since the downturn hit, estimates suggest thousands have been made redundant across associated sectors, including construction.
Thousands of redundancies have also been made in the financial sector. The job cuts could have a longer-term impact on the property market because of a dwindling local population. However, developers owned by the Dubai Government are working to streamline operations and, through integration and mergers, reduce further risks.
Dubai World said last month the property activities of its subsidiaries, Leisurecorp, Dubai Maritime City and Dubai Multi Commodities Centre, would now be managed by Nakheel, also owned by Dubai World. Emaar Properties is also in advanced merger talks with Dubai Properties, Sama Dubai and Tatweer, companies owned by Dubai Holding.
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Nakheel, a property developer owned by Dubai World, has made about 400 more staff redundant as the company continues an overhaul brought on by the downturn in the property sector.
The redundancies were staggered over the past two weeks and are on top of the 500 jobs that were cut last December, a source close to the company said.
"We were given a redundancy package of six months' pay" one former staff member who was laid off last week said.
The economic downturn has battered nearly every Dubai developer, with property prices and sales falling sharply. Developers, who were mostly reliant on off-plan sales to finance the construction of their projects, have struggled to collect payments, leading to rising defaults, while payments to suppliers have been delayed.
Nakheel yesterday confirmed the redundancies as the company continues to readjust its current business objectives to match supply and demand in the most effective way, but declined to say how many jobs have been cut.
Nakheel recently merged a number of its business units, which are now undergoing resource restructuring to ensure efficiency and optimisation of skill and talent, the company said.
The source said the bulk of the cutbacks affected the company’s asset management and design (NAMAD) division, a unit that was formed only in February after the the design group and universe master planning divisions were merged. The source said Imdaad, a facilities management (FM) firm also owned by Dubai World, would now manage most of the infrastructure and facilities across Nakheel's projects.
But Nakheel denied this, saying: NAMAD's facilities management team is functioning as usual. Imdaad has been providing FM services to Nakheel as a service provider in various communities following the usual practices of engaging a service provider.
The redundancies come after at least five years of expansion, during which Nakheel took on staff for large salaries in order to resource its ambitious projects, which include the Palm island trilogy, The World and Waterfront.
It was a time when all Dubai developers scrambled to attract staff, with poaching being the norm and salaries being high.
A junior level staff member, for example, could earn about Dh80,000 (US$21,780) a month with a company such as Nakheel, according to Simon Hobart, the managing director of the recruitment firm Millennium Solutions.
Everyone was earning big money in the first six to eight months of last year, with the problems associated with that now being enormous, Mr Hobart said. Nakheel was paying people too much, it all went a bit mad. Some of these guys were only 24 or 25 years old. Today, they’d get a third of what they were on.
While there is no official figure on how many jobs have been lost in the property sector since the downturn hit, estimates suggest thousands have been made redundant across associated sectors, including construction.
Thousands of redundancies have also been made in the financial sector. The job cuts could have a longer-term impact on the property market because of a dwindling local population. However, developers owned by the Dubai Government are working to streamline operations and, through integration and mergers, reduce further risks.
Dubai World said last month the property activities of its subsidiaries, Leisurecorp, Dubai Maritime City and Dubai Multi Commodities Centre, would now be managed by Nakheel, also owned by Dubai World. Emaar Properties is also in advanced merger talks with Dubai Properties, Sama Dubai and Tatweer, companies owned by Dubai Holding.
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