(Adds details from AGM, background)
By Stanley Carvalho
ABU DHABI, April 18 (Reuters) - Dubai builder Arabtec got approval from shareholders on Tuesday for a planned 1.5 billion dirham ($409 million) rights issue, sources told Reuters, as the troubled firm strives to position itself for a turnaround.
Shareholders also approved plans to use existing capital to wipe out accumulated losses, people present at the annual general meeting said.
Media were not admitted to the meeting and company officials were not immediately available to comment.
Loss-making Arabtec has been struggling for more than two years in a depressed Gulf market for infrastructure projects, its problems exacerbated by internal strife among shareholders and several senior management changes.
The company, which reported accumulated losses of 4.6 billion dirhams last year, is asking banks to waive terms on its debt, banking sources told Reuters on Monday.
“Shareholders agreed to the proposed rights issue and wiping out accumulated losses not exceeding the capital and authorized the board to proceed with the plan,” one of the sources said.
Arabtec’s current share capital stands at 4.61 billion dirhams, while its accumulated losses are 4.64 billion dirhams, according to its balance sheet ending 2016.
Arabtec’s executives told shareholders the company would announce a profit for the first quarter of 2017, a second person said.
Earlier this week, the company said it had appointed Peter Pollard as its new group chief financial officer who will succeed acting group CFO Ravi Murthy.
Murthy, who was appointed acting group CFO in July 2015, will move to become CFO of the company’s subsidiary, Arabtec Construction.
Arabtec shares closed 0.36 percent higher at 0.840 dirhams. Its share price has fallen nearly 36 percent this year.
$1 = 3.6720 UAE Dirham Writing by Andrew Torchia; Editing by Mark Potter