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Dubai's economy has rebounded strongly from a
local property crash which triggered a wave of debt
restructurings at state-owned entities at the turn of the decade
- most notably Dubai World's request for a debt standstill on
$25 billion of obligations in 2009 that resulted in a global
markets sell-off.
It has been in talks with lenders for months to secure a
renegotiation of terms of the debt deal it signed in 2011 which
followed the 2009 standstill request.
On Monday, it said it had made a "voluntary arrangement
notification" under Decree 57 -- legislation brought in by the
Dubai government to administer the conglomerate's previous
restructuring at the turn of the decade -- to amend its existing
debt deal.
The notice was the first formal notification from the
conglomerate that support from creditors for a new deal had
passed the 67 percent mark -- the level needed to authorize a
change of terms to the restructuring.
Top Dubai officials had indicated in recent weeks that creditor
support was close to this mark, while banking sources told
Reuters last month that Dubai World had received 70 percent of
creditors' support for its revised restructuring deal after
talks with lenders in Dubai and London in early December.
The new restructuring plan involves repaying early an existing
$2.92 billion maturity due in September 2015, Dubai World said.
The company would extend a 2018 repayment to 2022, with higher
pricing, an amortizing structure and more collateral backing the
loan, it added.
This confirmed a Reuters story from September which detailed the
terms being offered to creditors.
The restructuring deal could take several months to complete,
Dubai World's statement said, as the Decree 57 process will be
administered by a court in Dubai's financial free zone.
(Reporting by Tom Arnold; Editing by David French and Susan
Thomas)
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