Business | General

Dubai World seeks to separate firms

Government is 'always behind' the holding company, says chairman of the Dubai Supreme Fiscal Committee

  • Bloomberg
  • Published: 00:00 March 13, 2010
  • Gulf News

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  • Uncertainty over the outcome of talks between creditors and Dubai World regarding $22 billion of debt - equal to almost half the UAE's estimated oil revenue last year - has weighed on the emirate since late November when the need to restructure the conglomerate was first announced. Supplied
  • Image Credit: Supplied

Dubai: Dubai World is seeking to separate "good" businesses from underperforming assets as part of its restructuring plan, the chairman of the Dubai Supreme Fiscal Committee said.

"What we try to do is trying to separate the bad business from the good business," Shaikh Ahmad Bin Saeed Al Maktoum, chairman of the Dubai Supreme Fiscal Committee and President of Dubai Civil Aviation and Chairman and Chief Executive of Emirates Airline and Group, said in New Delhi yesterday.

"There's a lot of good business like the port business, free zone, dry dock."

Dubai World and its Nakheel PJSC and Limitless LLC property units used loans to finance real estate projects such as the palm tree-shaped islands off the coast. Dubai World said in November it would seek to delay repaying all loans until May.

Nakheel's 2.75 per cent $750 million sukuk due in January gained 9 cents in the week to 61.625 cents on the dollar, according to Citigroup Inc prices.

The benchmark Dubai Financial Market General Index rose 1.5 per cent to 1,683.89 on Thursday.

Credit default swaps linked to Dubai declined nine basis points to 471.3 basis points, prices provided by CMA DataVision indicate.

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The government is "always behind" Dubai World, said Shaikh Ahmad.

Dubai World will ask banks for permission to delay loan repayments when it presents a plan this month, said three bankers familiar with the negotiations on March 8.

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