Dubai: Limitless hasn’t paid banks about $517 million (Dh1.89 billion) it made from a land sale in Saudi Arabia, more than four months after promising to do so as part of talks to restructure its debts, two people with knowledge of the matter said.
The Dubai-based developer is refusing to pay creditors until they agree to a restructuring proposal for an additional $648 million of debt, the people said, asking not to be identified because the talks are private. Banks don’t agree with the terms of the new offer and are refusing to approve the deal, leading negotiations to stall, according to the people.
Government-controlled Limitless in June said it would pay about Dh1.9 billion, or about 42 per cent of the company’s outstanding bank debt of Dh4.45 billion, to lenders after selling a plot of land in Riyadh to Saudi Real Estate Co. It also agreed to an additional Dh176 million payment to trade creditors. A Limitless spokeswoman, who asked not to be identified, said private discussions continue with creditors, without giving further details.
Limitless is one of several Dubai government-related entities that delayed debt payments after asset prices slumped and credit markets froze during the financial crisis. The company began talks to restructure a $1.2 billion Islamic loan for a second time last year. Chairman Ali Rashid Lootah said earlier this year that he hopes the company will be debt-free by 2018 and making a profit before then.
Emirates NBD PJSC, National Bank of Abu Dhabi PJSC, Dubai Islamic Bank PJSC, Mashreqbank PSC, Arab National Bank and Silver Point Capital LP make up the creditors’ committee that was negotiating a deal on behalf of lenders, three people familiar with the company’s restructuring said in January.
