Dubai developer Emaar Properties, the largest developer in the United Arab Emirates, may have to raise cash to go ahead with its planned merger with three local property firms, investment bank Nomura said.

Dubai Holding, owned by the ruler of Dubai, and Emaar, said last week, the builder of the world's tallest tower, would merge with local real estate firms Dubai Properties, Sama Dubai and leisure developer Tatweer.

'Emaar may have to raise equity (and possibly a lot) to support its private development counterparts,' said Chet Riley, an analyst at the bank said in a note sent to clients June 26.

Emaar said in January it set up a $4 billion borrowing plan which included a $2 billion euro medium-term note (EMTN) programme and a $2 billion trust certificate programme, but was unlikely to draw on the debt until market conditions improved.

The proposed new entity would have debt obligations equivalent to around 7 percent of total assets, which would be around 194 billion dirhams ($52.83 billion), Emaar's chairman Mohammed Alabbar said on Sunday.

Moody's Investors Service earlier on Tuesday said it placed on review for downgrade Emaar, and downgraded Dubai Holding due to difficult conditions in the emirate's property sector.-Reuters