Investment vehicle owned by the Group ruler of the emirate of Dubai, which aims to ensure that the June 6, U.S. $ 10 billion dollars in debt restructuring with creditors to reach a final agreement may be the end of marathon talks have dragged on for nearly three years.
Dubai Group proposed transaction is the last major debt restructuring involving Dubai financial crisis of 2008-2009 has not yet agreed. So in the talks succeed, will be treated as a major step in the emirate recover from the crisis.
The company, which is one of its units of Dubai Holding, Sheikh Mohammed Bin Rashid Al Maktoum's investment institutions, in 2008, hit hard by the global financial crisis asset value fell to disclose their use of leverage principle.
Missed two loan interest paid in 2010, it has been locked in talks with its lenders to extend the repayment period. Dubai Group $ 10 billion in total debt, $ 600 million dollars is owed to the bank and inter-company loans are classified as the remaining 400 million yuan.
Final reorganization of the file is sent to the unsecured creditors and bankers meeting on Wednesday is scheduled to be held in Dubai on May 15, two negotiations informed source said on condition of anonymity to speak is not public information.
Other Debt restructuring has agreed to the unanimous approval of unsecured creditors is needed to allow completion of the transaction.
Dubai Group did not immediately comment.
Informal agreement
File out today, so we finally have, but this is far from a done deal, "said one of the sources, although the terms of an informal agreement between the bank, the plan may still be refused.
"Another method is that the deal will be down, but the banks will have to ask yourself," This is a good thing for us and Dubai, if it fails? "
The source said that if the bank agrees to the deal by June 6, they will pay the signing fee. They refused to disclose the specific number.
Dubai Group's creditors, including a wide range of banks, such as the UK's Royal Bank of Scotland (RBS.L: Quote), Standard Bank of South Africa (SBKJ.J), Germany the commercial banks (CBKGk.DE) and international commercial banks (COMI.CA) Egypt.
In terms of Dubai Group restructuring, the creditor is required to extend the obligations between 3.5 years and 12 years, according to the risk of mortgage assets, the value of the assets of Dubai Group divestment before the recovery.
Unsecured creditors, they have provided a extended for another 12 years, there is an option repayable after five years, but at a discount.
In January, Dubai Group's clearing bank to take legal action to ensure repayment of their share of the debt, a move paved the way for the transaction to provide unsecured creditors.
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