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Dubai gets $1 bln early bids for infrastructure plan -sources | ASHARQ AL-AWSAT English Archive 2005 -2017
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DUBAI, (Reuters) – Dubai has so far attracted bids of about $1 billion to secure financing for infrastructure projects, a person familiar with the matter said on Tuesday, with banks given until mid-month to make final bids.

Dubai’s department of finance hired local and international banks last month to raise $800 million through the securitisation of road toll receipts.

The six-year financing is offered at 350 basis points over the London interbank offered rate (LIBOR) plus fees, two people said. The dual-currency transaction is expected to have a conventional and an Islamic tranche.

One banking source said the deal should close near the end of May, but that it was still early to determine the bid size.

Sources said banks had asked to push back the deadline for confirmed commitments until the middle of the May in order to get approval from credit committees, after extended public holidays in the United Kingdom and Europe.

Citibank, Commercial Bank of Dubai, Emirates and Dubai Islamic Bank are the mandated lead arrangers and book-runners for the financing.

Dubai launched its Salik electronic toll collection system in 2007 to ease congestion in the regional trading hub, which now has some 1.9 million inhabitants, and generate more income for the emirate, which lacks the oil wealth of neighbouring Abu Dhabi.

Medium term concerns remain over the glitzy emirate’s $100 billion-plus debt pile, with Dubai firms facing debt maturities of some $30 billion up to 2012 which will need refinancing.