RIYADH May 3 Dubai Group, an investment firm
owned by the emirate’s ruler, has requested creditors to take a
haircut on debt maturing in 2024 in exchange for an early
settlement, banking sources said.
The firm completed a restructuring on around $6 billion of
debt in 2014, with lenders agreeing to extend the maturity for
secured debt to December 2016 and unsecured loans to December
2024. A further $4 billion of debt was to be repaid after
creditors were satisfied.
In the last few days the company offered creditors around 29
cents on the dollar in return for an early settlement of debt
maturing in 2024, the sources said, declining to say the value
of the amount.
Creditors who decline the offer will be repaid at a higher
rate in 2024.
Parent company Dubai Holding declined to comment.
Dubai Group was one of a number of Dubai state-linked
entities which borrowed heavily from banks to fund an
acquisitions spree during the boom years of 2006-8.
The current creditors are mainly local banks, including
Emirates NBD, Dubai’s largest bank, which has among the largest
Dubai Group has shed assets in recent years including
selling a 48.4 percent stake in Dubai-listed investment bank
Shuaa Capital to Abu Dhabi Financial Group (ADFG) in June 2016.
It still holds a 12.8 percent stake in Bank Muscat,
according to Thomson Reuters data.
(Editing by Jason Neely)