Dubai: Noor Bank PJSC, which provided a $100 million (Dh367 million) loan to the collapsed Abraaj Group, won the right to swap the debt for stakes in some of the Dubai-based buyout firm’s funds, according to people with knowledge of the matter.

Privately-held Noor Bank won approval from a court in the Cayman Islands, where Abraaj is undergoing a supervised restructuring, to take ownership of stakes in the funds that were pledged against the loan. Noor Bank will hold the stakes alongside other investors and limited partners.

The lender may eventually be able to recover more than it lent to Abraaj when the assets in the funds are sold, one of the people said.

Abraaj was one of the most high-profile private equity companies in the Middle East until its dramatic collapse last year. The firm owes banks more than $1 billion and is being restructured after it defaulted on loans and was found to have borrowed money from some of its own funds to meet operating expenses without investors’ consent.

Court-appointed liquidators are now seeking to sell its funds and assets to repay investors. Other creditors to Abraaj include the Kuwait Public Institution for Social Security, Mashreqbank PSC, Sharjah-based Crescent Group Chairman Hamid Jafar, Commercial Bank of Dubai, Societe Generale and discount carrier Air Arabia PJSC, according to a PricewaterhouseCoopers report.