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-- Posted Monday, 29 March 2010 | Digg This Article | | Source: GoldSeek.com
Damas, the largest jewelry chain in the Middle East is to close or relocate some of its 450 outlets as a part of a $870 million debt restructuring deal that follows in the wake of a record $3.7 million fine for violating corporate governance standards last week. Yesterday a majority of the group’s banks agreed to a standstill agreement and officials said a restructuring plan would be implemented at the end of the standstill agreement period. They had previously announced in December that this would involve the closure of some of their 450 retail outlets. Corporate governance Last week the Dubai Financial Services Authority ordered the dismissal of the Damac board and fined the family owners for violations of corporate governance that amounted to treating the publicly quoted company like a private concern. The Abdullah bothers, Tawhid, Tamjid and Tawfique have been ordered to repay $99 million and two tonnes of gold that were taken for personal use and property investments. The Damas scandal is one of many that has rocked Dubai business since the collapse of the real estate boom 18 months ago. Many business arrangements that might never have surfaced have been exposed as lacking in proper corporate governance and are now the source of much embarrassment and public ridicule. Entrepreneurs who skate on thin ice and make it, are usually regarded as heros. Those who fall through and have to be rescued are seen as national liabilities. Merchant traders Yet where would Dubai be today without its merchant families, whatever their trading practices? It is actually men like the Abdullah brothers who built Dubai, and most recently they have devoted an enormous amount of time and effort to the highly successful creation of the Dubai Multi Commodities Centre. That is not to say that wrong has not been done, merely to note that entrepreneurs are rule benders by nature and that their value to a society amounts to much more than some of the people now passing judgment on them. For where does the wealth of a city like Dubai come from if not its merchant families? If this inconvenient truth is forgotten then Dubai really does have a problem. It is very sad to see Damas closing and not opening jewelry shops.
-- Posted Monday, 29 March 2010 | Digg This Article | Source: GoldSeek.com
Previous Articles by Peter Cooper
About Peter Cooper:
Oxford University educated financial journalist Peter Cooper found himself made redundant by Emap plc in London in the mid-1990s and decided to rebuild his career in Dubai as launch editor of the pioneering magazine Gulf Business. He returned briefly to London in
1999 to complete his first book, a history of the Bovis construction group.
Then in 2000 he went back to Dubai to become an Internet entrepreneur, just as the dot-com market crashed. But he stumbled across the opportunity to become a partner in www.ameinfo.com, which later became the Middle East's leading English language business news website.
 Over the course of the next seven years he had a ringside seat as editor-in-chief writing about the remarkable transformation of Dubai into a global business and financial hub city. At the same time www.ameinfo.com prospered and was sold in 2006 to Emap plc for $27 million, completing the career circle back to where it began a decade earlier.
He remains a lively commentator and columnist as a freelance journalist based in Dubai and travels extensively each summer with his wife Svetlana. His financial blog www.arabianmoney.net is attracting increasing attention with its focus on investment in gold and silver as a means of prospering during a time of great consumer price inflation and asset price deflation.
Order my book online from this link
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Jewelry Shops to Close in $870m Damas Debt Standstill Deal
