DP World is to repay all US$3 billion (Dh11bn) outstanding under its revolving credit facility by next month from "existing cash resources", the ports group based in Dubai said yesterday.
The group will also cancel $2bn of its existing revolving credit facility due to mature in October and open a new five-year revolving credit facility of $1bn.
"We are very pleased to have put in place a new bank deal in the current market climate," said Mohammed Sharaf, the chief executive.
"We are in the final stage of agreeing documentation with the banks that have committed to this new facility and expect it to replace the existing facility shortly.
"The new facility will be used to provide DP World with flexibility to manage cash flow and investment in our portfolio. We have no immediate need to draw down the new facility."
The repayment will be made between April 4 and April 10, said DP World's chairman Sultan Ahmed bin Sulayem. "We are delighted to be in a position to repay all outstanding $3bn of our revolving credit facility six months ahead of maturity.
"As at 31 December 2011, DP World had $4.2bn of cash balances including cash flow generated from its portfolio of global terminals and the proceeds of the monetisation of the five terminals in Australia.
"Following this $3bn repayment, DP World will have reduced total debt to approximately $4.7bn and have cash balances of approximately $1.2bn."
The news failed to excite investors, with shares in DP World trading unchanged at £6.82 on the London Stock Exchange at noon yesterday.
DP World operates more than 60 terminals across the globe, and is expanding operations in China, India and the Middle East as it seeks to boost capacity to 100million 20-foot equivalent container units (TEU) by 2020.
The company said in December it would invest $850 million over the next three years to increase capacity at its flagship Jebel Ali port on the outskirts of Dubai.
DP World handled 54.7 million TEUs at its ports last year, compared with 49.6 million TEUs in 2010 and the company, which is scheduled to make its preliminary statement on Thursday, has forecast full-year gross profit to be "in line with expectations" after reporting a better than expected 36 per cent rise in first-half profit to $281m.
DP World shares are listed on the Nasdaq Dubai and the London Stock Exchange.
Last month, Credit Suisse upgraded DP World from "neutral" to "outperform" and its target price by 18 per cent to $14.70 per share.
The bank, based in Switzerland, has increased its 2012 to 2014 consolidated throughput forecasts for DP World by 1 per cent to 3.5 per cent to reflect "expectations of a softer slowdown of global container volumes growth and the new projects to be commissioned from 2014 onwards".
Vincent Resillot,a research analyst at the Swiss bank, said DP World had the advantage of investing in "cheap capacity" in existing facilities, such as the home base of Jebel Ali Terminal 3, or mainly through "inexpensive project financing" in new projects such as the London Gateway development, which is due to open next year.
Credit Suisse noted that growth had resumed in the majority of DP World's consolidated portfolio.