Cimic joint venture boss arrested in Dubai

Building giant Cimic continues to be dogged by scandals, with the arrest of the CEO of part-owned Habtoor Leighton.

Dubai’s skyline.

Engineering and construction heavyweight Cimic Group continues to be dogged by scandals, with the chief executive of one of its part-owned subsidiaries arrested in Dubai.

In a statement to the market this morning, Cimic (CIM) said the head of Habtoor Leighton Group, in which it owns a 45 per cent stake, had been detained by Dubai police.

The news weighed on the group’s shares, which slid 2.9 per cent to $30.34 at 12.30pm (AEST).

The group offered little information about the nature of the arrest of Jose Antonio Lopez-Monis, saying it would update the market when further information was available.

“As a result of a complaint filed with police in Dubai, the CEO and MD of HLG, José Antonio López-Monís, was arrested after market close on Wednesday, August 17,” the group said in a statement.

“HLG is assisting Mr López-Monís.”

Habtoor Leighton is one of the leading contractors in the Middle East and recently drew attention after Al Habtoor Group said it had “no relationship” to the company.

The news came as a surprise to the market as Al Habtoor Group was thought to be Cimic’s main partner after it entered into a JV with Cimic — then known as Leighton — almost a decade ago.

Al Habtoor told Arabian Business it had sold its position several years ago, but did not reveal the acquirer.

The arrest of Mr Lopez-Monis also comes after Morgan Stanley warned it was struggling to reconcile Cimic’s accounts, declaring a “disconnect” between profitability and cash flow.

The bearish Morgan Stanley report was quickly followed by a share price rout on the back of a disappointing half year report, with problems mounting as The Australian revealed the group might be hiding millions of dollars in losses relating to the WestConnex project.