Press Release

Kuwait/July 20th/2009

• Al Mazaya’s net asset value: KD 259 million, against KD 235 million book value

• Al Mazaya’s fair stock value: 368 fils, compared to book value of 314 fils

Al Mazaya Holding has decided not to go ahead with acquiring First Dubai Co.’s remaining shares at this time. The decision came following a study conducted by Al Shall consulting Company, which showed that acquiring 100% of First Dubai’s shares will not increase what Al Mazaya has achieved with 67% ownership. However, Al Mazaya has stated that it would still consider acquiring the remaining First Dubai shares if current conditions improved and the economic benefits – such as cost saving, and the integration of human, capital and real estate resources – prove greater than the costs and effort involved in completing the acquisition process.

Al Shall’s evaluation of Al Mazaya’s fair share value was based on several methods. First, an estimate of Al Mazaya’s net asset value, which amounted to KD 259 million, was compared against the company’s book value, which reached KD 235 million, and its total liabilities, which amounted to KD 94 million. According to this method, Al Shall’s estimated fair share value for Al Mazaya increased to 368 fils, compared to the recorded book value of 314 fils. The second method used included calculating the average share price over a 5 month period, which gave an average of 216 fils. The third method involved comparing Al Mazaya’s stock value with other companies working in the same sector, which yielded a fair share value of 345 fils.

Al Shall made several field visits to Al Mazaya asset locations and, in coordination with Al Mazaya, assigned a group of specialist evaluators – such as Jones Lang LaSalle in Dubai – to evaluate major assets in each market. Al Shall then used the end results of the evaluation to estimate the net fair value of Al Mazaya’s assets. As such, the fair value of Al Mazaya’s shares, which was supposed to be used in the acquisition process, is higher than the value during the 5 months preceding the final results of the study.

Al Shall believes that the current Al Mazaya share price in the local market is 30–40% lower than its fair value.

Eng. Khalid Esbaitah, Al Mazaya Holding CEO and Deputy Chairman, said, “Al Mazaya’s projects and investments in Kuwait and abroad provided protection against the economic crisis. Al Mazaya is now more focused on ‘reorganization from the inside’, in preparation for another giant improvement, especially with the improving performance of companies and markets which will be mostly clear starting the second half of the year”.

Esbaitah said that one of the steps needed for the reorganization process was to evaluate the financial situation of the target company so as to reduce costs and effort, and the acquisition of First Dubai remained a likely step to make due to the fact that First Dubai has vital and impressive projects including Sky Gardens in Dubai and Morina Residences in Abu Dhabi. First Dubai’s total assets amount to KD 142 million, while its capital amounts to KD 100 million.

He went on to say that Al Mazaya’s current plan revolves around delivering all of its projects in Dubai, and that all projects have progressed very well due to good cash flow and high completion rate. Al Mazaya recently delivered two towers in the completely sold ‘The Icon’ residential project, in addition to delivering 104 stage one villas of a total of 700 in ‘The Villa’ project in Dubailand. The remaining villas will be delivered in stages by April 2010. Al Mazaya has also made significant progress in its ‘Business Avenue’ project, which is 65% complete and 100% sold out, while work is progressing well on its ‘Queue Point’ project in Al Liwan, which comprises 52 buildings aimed at medium-income earners, and is now 35% complete.

Esbaitha stated that profits from these projects will be added to Al Mazaya’s total profits over the next 2 years, noting that Al Mazaya’s current projects in Kuwait are also nearing completion, including the ‘Clover Clinic’ and ‘Kuwait Business Town’ projects, as well as the ‘7 Zones’ project, which is expected to begin operations in October. He added that these projects are among Al Mazaya’s “profitable projects”, which play vital role in diversifying Al Mazaya’s portfolio of investments in order to include safe assets for the company.

Regarding Al Mazaya’s expansion plans, Esbaitah said that the firm has decided to delay the development of projects located at the Waterfront and Downtown Jebel Ali following a comprehensive study that included all plots owned by Al Mazaya at these locations. He added that these projects will be resumed once local and international markets have stabilized. Esbaitah went on to say that his company is currently studying the property markets in KSA and Qatar in order to start new projects in these markets.