Dubai World creditor expects debt resolution soon

Dubai World creditor expects debt resolution soon
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First Published: Mon, Apr 26 2010. 07 05 PM IST
Updated: Mon, Apr 26 2010. 07 05 PM IST
Dubai, United Arab Emirates: One of Dubai World’s major creditors said Monday that restructuring talks with the debt-laden conglomerate are moving ahead and should be resolved soon.
Rick Pudner, CEO of Emirates NBD, said negotiations with the struggling state-owned company are still ongoing but are “progressing very positively.”
“A lot of progress has been made over the last few weeks. We are hoping for a satisfactory resolution,” Pudner told reporters in a conference call.
The Dubai-based bank is part of a committee of leading creditors trying to hammer out a resolution with Dubai World. The conglomerate shocked global markets late last year by seeking new terms on $26 billion in debt — a fraction of the more than $80 billion owed by the semiautonomous city-state.
Emirates NBD is one of two Emirati banks on the negotiating committee, which also includes international lenders such as HSBC Holdings PLC, Royal Bank of Scotland Group PLC and Standard Chartered PLC.
It is the only one of the creditors that’s majority owned by the Dubai government, which holds a controlling stake through its Investment Corp. of Dubai investment arm. Nearly two-fifths of the company is publicly traded.
Pudner said he hoped a resolution would be reached with Dubai World “in the not too distant future,” though he acknowledged that the exact timeframe remains uncertain.
“Certainly in the next few weeks,” he said, declining to discuss the specific terms Dubai World is offering lenders.
Dubai’s government announced last month it would pump up to $9.5 billion into the struggling conglomerate as part of a long-awaited restructuring plan. That proposal still needs approval from dozens of creditors, including Emirates NBD.
Separately on Monday, Dubai World’s global seaport operator DP World said it still aims to list its shares on the London Stock Exchange.
“We remain committed to listing our shares ... and are focused on completing the process as soon as possible,” chief executive Mohammed Sharaf said in a statement that will be read at the company’s annual meeting Monday.
DP World announced the London share float plan in January in an effort to attract new investors amid poor performance with its hometown Nasdaq Dubai stock listing. It said at the time it might seek the listing as early as the second quarter of this year.
Sharaf also said the company is seeing signs of a recovery in sea trade, with first-quarter volume up 6 percent to the equivalent of 6.3 million 20-foot shipping containers, a standard measure of cargo volume. He attributed the gain to increased business in the Indian subcontinent, Australia and parts of Europe.
The profitable cargo handler is considered one of Dubai’s crown jewels, running the Middle East’s largest port in Dubai and 48 other marine terminals around the world.
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First Published: Mon, Apr 26 2010. 07 05 PM IST