RPT-UPDATE 2-Dubai World reaches $24.9 bln debt deal

(Repeats to add links)

* DW gets formal deal with over 99 pct of creditors

* Says well-placed to close restructuring in weeks

* Deal days after Dubai Holding unit delays loan repayment

* Govt “continues to focus on Nakheel”

(Recasts adding analyst quotes, further details)

By Jason Benham

DUBAI, Sept 10 (BestGrowthStock) – State-owned conglomerate Dubai
World [DBWLD.UL] on Friday reached a formal deal to restructure
around $24.9 billion of liabilities, partly easing recently
heightened concerns over the Gulf emirate’s debt woes.

While Dubai World’s agreement with most of its creditors is
seen as a positive step for Dubai, the announcement comes just
days after a unit of Dubai Holding, the conglomerate owned by
Dubai’s ruler, said it will delay repayment on a $555 million
loan, the second time it has failed to meet a repayment
deadline. [ID:nLDE68609O]

“Most players had expected this outcome and that the
restructuring would be completed by October or November,” said
Andre Andrijanovs, credit analyst at Exotix in London.

“It is a surprise that it has happened so quickly and that
an agreement was reached this week, and that be will a positive
momentum for Dubai … There are other situations though that
need resolving such as Dubai Holding.”

Dubai World reached an agreement with over 99 percent of its
creditors by value to restructure around $24.9 billion of
liabilities, the government of Dubai said in a statement. Dubai
World said in a separate statement it is well positioned to
close the restructuring in “the coming weeks”.

“The agreement formalises a strong 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 the statement on Friday.

The government of Dubai remains a supportive and committed
shareholder, the statement added.

Dubai World’s target date for completion, assuming
consensual agreement reached with creditors, was October 1, a
final restructuring proposal presented to creditors on July 22
and obtained by Reuters in August, showed. [ID:nWLA1451]

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.[ID:nLDE62O010]

“Any resolution is positive and we had news on Dubai Holding
last week,” said Abdul Kadir Hussain, chief executive of Mashreq
Capital in Dubai.

“There is progress on all of these which will deem positive
for the debt position in Dubai,” he added.


In Friday’s statement the government said “it continues to
focus on Nakheel and is pleased with the significant progress
achieved by the company to date in discussions with its

Troubled Dubai property developer Nakheel [NAKHD.UL], a unit
of Dubai World, which overstretched itself building islands in
the shape of palms and other ambitious real estate, is holding
separate restructuring talks.

Under the restructuring of its parent company, the developer
would be placed directly in the hands of the government.

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 restructuring proposal document
obtained by Reuters.

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 Nakheel has $10.9 billion of bank
debt and will receive key assets from Dubai World after
separation. [ID:nLDE67000M]

For a FACTBOX on Dubai World’s restructuring plan, click on:

For a Take a Look on Dubai’s debt, click on [ID:nLDE6870K8]

RPT-UPDATE 2-Dubai World reaches $24.9 bln debt deal