Business | Banking

Dubai Holding's main arm extends $555m loan

Main unit's $555m loan which was due on November 30 pushed forward to December 30

  • Reuters
  • Published: 00:00 December 2, 2010
  • Gulf News

Dubai: Conglomerate Dubai Holding's main unit has extended a $555 million (Dh2.04 billion) loan due on November 30 to December 30.

This was the third extension for Dubai Holding's hospitality and property arm, Dubai Holding Commercial Operations Group (DHCOG). DHCOG previously delayed the loan in July and September.

"The extension is required to finalise a new long-term facility," the company said yesterday.

Optimism

Analysts say there was general optimism that Dubai would be able to successfully restructure debt at Dubai Holding and its units.

"Once the Dubai World debt problem was fixed, the general impression is that you created a blueprint for future restructurings," said Shakeel Sarwar, head of asset management at Bahrain-based Securities and Investment Co (SICO).

"But until we come up with solid news that the loan has been restructured like the previous Dubai World loan, there will be a bit of nervousness."

All eyes have been on Dubai Holding and its units following Dubai World's restructuring. "We can't make an automatic assumption that Dubai World's restructuring will be the same for everyone else," said Abdul Qader Hussain, chief executive at Mashreq Capital.

"Dubai Holding has some attractive businesses, and its overall debt is smaller than Dubai World's."

The company has debt obligations estimated at $14.8 billion.

Hussain said while DHCOG's latest extension was expected, the market is looking towards signs of a more permanent solution on the horizon.

Challenges

At a meeting with reporters on Sunday, Shaikh Ahmad Bin Saeed Al Maktoum, Chairman of the Dubai Supreme Fiscal Committee, said Dubai Holding was facing challenges as a result of the global financial crisis but reiterated the company still had solid assets and investments.

He said Dubai Holding's issues were "in no way comparable" to Dubai World's challenges, but officials declined to provide specifics about Dubai Holding's restructuring plans.

Gulf News
Retail Gold Rate
Business Editor's choice
Quick Access

  1. Markets

  2. Economy

  3. Property

  4. Aviation

Business Top Stories

  1. Should CVs with typos be thrown in the bin?

  2. Indian presses ahead with banking the unbanked

  3. GCC banks return to double-digit profit growth

  4. So much heat is being expended over solar power

  5. Tech giants don’t have the monopoly on smarts