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10sep10
Dubai World in formal debt deal for $24.9 billion
State-owned conglomerate Dubai World has come to a formal agreement with over 99 percent of its creditors to restructure around $24.9 billion of liabilities, the government of Dubai said on Friday.
In a separate statement Dubai World said it is well-positioned to close the restructuring in "the coming weeks."
"The agreement formalizes a b consensus about a fair and balanced restructuring proposal and is a key step to putting Dubai World on a sound and stable financial footing," Sheikh Ahmad Bin Saeed Al Maktoum, chairman of the Dubai Supreme Fiscal Committee said in a statement.
The government of Dubai remains a supportive and committed shareholder, the statement added.
"The government of Dubai continues to focus on Nakheel and is pleased with the significant progress achieved by the company to date in discussions with its creditors," it added.
Dubai World's target date for completion, assuming consensual agreement reached with creditors, is October 1, a final restructuring proposal presented to creditors on July 22 and obtained by Reuters in August, showed. The date for lenders to return the signed lock-up agreement and get paid the consent fee was September 9.
Dubai World, plans to sell its prized assets over a period of eight years to generate as much as $19.4 billion to pay off creditors, according to the document.
It said in the document asset disposals over an eight-year period will help generate up to a maximum of $19.4 billion, while similar sales based on current prices would be worth a maximum of $10.4 billion.
The document also showed Dubai developer Nakheel has $10.9 billion of bank debt and will receive key assets from Dubai World, its parent company, after separation.
Concerns about the overall debt burden of Dubai's state-linked companies mounted after Dubai announced a standstill on repaying $26 billion in debt as it restructured Dubai World. It unveiled a $9.5 billion rescue plan for the firm in March.
[Source: By Jason Benham, Reuters, Dubai, 10Sep10]
 | This document has been published on 23Sep10 by the Equipo Nizkor and Derechos Human Rights. In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. |