Eshraq plows on with its buyback program: Real real estate investment company Eshraq bought 345k treasury shares last Friday on the ADX, raising its treasury share holdings to 4.76%, according to a bourse filing. A block trade on Eshraq Investments yesterday saw 87.07 mn shares (at AED 0.409 apiece) worth a total of AED 35.6 mn purchased on the ADX yesterday, Wam reports.

About the buyback program: The ADX approved the renewal of Eshraq’s buyback program on 25 October, with the extension running through until 31 December, according to a bourse filing. The current program sees Eshraq buying treasury shares to enhance its long-term shareholder value by taking advantage of the undervaluation of its shares, the company had said last month.

The buybacks come as a new leadership team and board push ahead with a turnaround strategy: Former Adnoc CFO Mohamed Al Hashimi was appointed as Eshraq’s new CEO in August, and a month later the company disclosed the departures of three board members, forming a smaller, more focused board. Eshraq then rolled out the new buyback program, mirroring the same sequence of events we saw back in 2016 with a board shuffle.

The pitch to investors: The company is making a play to become a diversified multi-asset investment house. It has a new leadership team, a new board, it’s monetizing its land bank, diversifying into to add asset classes outside real estate, and running a buyback to show confidence in its own strategy.

What it’s done so far: It has rebranded as Eshraq Investments and acquired Goldilocks Investment Co. in summer 2022. The board then announced a strategic change in September, making “Goldilocks … the company’s core asset, and the composition of the assets is expected to lead to greater stability, improved returns and reduced mark-to-market volatility.”

The company has been selling non-core assets to free up capital, deleveraging its balance sheet (it’s cut total liabilities by 34% year-to-date) and trimming its net loss to AED 83 mn in 3Q 2023 from 474 mn in the same period last year. It sold land plots in Abu Dhabi’s Reem Island and Dubai’s JVC earlier this year and has also exited 58 units of Burj Daman and the Nuran Marina Hotel in Dubai, generating a bit more than AED 500 mn in proceeds since late 2022.

The focus on the real estate side of the house: Working on non-income-generating assets and pursuing new, profitable investments, it says.

The Goldilocks unit, meanwhile, is deploying capital across a range of asset classes. About 51% of its portfolio is in publicly traded assets, with 46% in private equity, and 3% invested in debt instruments. Its 19 investments include Dana Gas (the region’s largest non-state-owned natural gas player), Salama (a top-five UAE insurance provider), Stanford Mariane, and Allianz Marine. Shipping, financial services, and energy make up more than 80% of its portfolio.

Go deeper: Check out Eshraq’s 3Q 2023 earnings release (pdf). The company outlines its turnaround strategy in this management presentation (pdf).

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