Dubai: Emaar Properties, the Arab world’s largest real estate developer by market share, has agreed to a shares for land deal with Dubai Holding, the government’s investment arm.

Under the agreement announced on Sunday, Emaar will issue 2.364 billion new shares in return for an unspecified area of land.

Emaar has 6.096 billion shares outstanding, a number that would rise to 8.46 billion with the new shares, giving Dubai Holding a stake of about 27.9 per cent. The government already owns approximately 32 per cent of the company, giving it a combined 51 per cent stake with the new shares.

“It effectively gives the government of Dubai, in its different entities, control of the company,” said Tamer Bazzari, director of Dubai-based Rasmala Investments.

Emaar and Dubai Holding did not give a value for the transaction, nor the area of land exchanging hands or how it will be developed. Based on yesterday’s closing share price, the new stocks would be worth Dh27.9 billion.

In a statement, Emaar said it will call for an extraordinary general meeting to secure shareholders’ approval of the increase in the company’s capital.

“Today, as an international player with a substantial presence outside of Dubai, Emaar has amassed a valuable land bank, embarking on landmark initiatives to provide the crucial catalyst for this region’s economic growth,” Mohammad Al Gergawi said in a joint company statement.

“Through equity partnership, Dubai Holding and Emaar can jointly tap these remarkable prospects and be an integral part of the region’s incredible growth story.”