Middle-east Arab News Opinion | Asharq Al-awsat

Dubai Group restructuring about $10bln -source - ASHARQ AL-AWSAT English Archive
Select Page

DUBAI, (Reuters) – Dubai Group, part of a conglomerate owned by the emirate’s ruler, is restructuring about $10 billion in debts with creditors, a source close to the discussions said, but an agreement is far from close.

Two sources familiar with the company’s restructuring with banks said talks are still at a very early stage, contrary to a senior regional banker who said last week that a deal could be signed in the second quarter. The source close to the discussions, speaking on condition of anonymity, said the company was restructuring $10 billion, comprised of about $6 billion in bank debt already disclosed.

The remaining $4 billion relates to other inter-company transactions such as direct shareholder loans to the company, and cash moved around the wider group to subsidiaries, the source said.

When asked about the terms of the restructuring, the source said talks were “barely out of the starting blocks”, but added that banks will try to ensure that the additional $4 billion is subordinated to the $6 billion in bank claims.

Banks would predictably want to be priority creditors in any restructuring scenario which is likely to include repayment after a set time period and asset sales. A Gulf-based banker also familiar with the matter said an agreement could be several months away.

A spokesman for the company declined to comment when contacted by Reuters.

Dubai Group, which focuses on banking, insurance and investments, has stakes in Dubai-based investment bank Shuaa Capital, Greek group Marfin Investment Group and Australian company Citigold Corp.

It is the financial services arm of Dubai Holding, owned by Dubai’s ruler.

In January, Dubai Group said it had set up two creditor committees made up of secured and unsecured lenders in order to speed up the restructuring. Among the company’s outstanding debt is a $1.5 billion murabaha Islamic financing facility due August 2011.

Asharq Al-Awsat

Asharq Al-Awsat

Asharq Al-Awsat is the world’s premier pan-Arab daily newspaper, printed simultaneously each day on four continents in 14 cities. Launched in London in 1978, Asharq Al-Awsat has established itself as the decisive publication on pan-Arab and international affairs, offering its readers in-depth analysis and exclusive editorials, as well as the most comprehensive coverage of the entire Arab world.

More Posts

Follow Me:
FacebookGoogle PlusYouTube