ABU DHABI/KUALA LUMPUR (Reuters) - Abu Dhabi and Malaysia have reached a conditional agreement under which Malaysian state fund 1MDB will pay $1.2 billion to settle a debt dispute that had led to arbitration proceedings in London.
Separately, 1MDB and Malaysia’s Ministry of Finance will assume responsibility for all future interest and principal payments under two bonds issued by 1MDB Group companies that are guaranteed by the Malaysian state fund and Abu Dhabi’s International Petroleum Investment Co (IPIC), IPIC said in a filing in London.
The agreement is conditional on the Arbitration Tribunal making a “consent award” by May 31.
Last year Abu Dhabi’s state-owned IPIC asked the London court to arbitrate in a dispute with 1MDB in which IPIC claimed about $6.5 billion. [nL8N1961AI]
1MDB, once a pet project of Malaysian Prime Minister Najib Razak, is the subject of money-laundering investigations in at least six countries. 1MDB has denied these allegations.
Reporting by Stanley Carvalho and Praveen Menon; editing by Jason Neely