Dubai World has reached a deal with its main creditors to extend the repayment of US$10.3 billion of debt, two people with knowledge of the matter said.
The group, which owns the world’s third-largest ports operator, agreed with the creditor committee to repay in 2022, four years later than previously agreed on, the people said, asking not to be identified as the information is private. Dubai World also agreed to repay $4.4bn of loans due September 2015 early if creditors approve the deal, the people said.
Dubai’s accelerating economy is prompting companies to renegotiate loan terms and seek new deals as interest rates decline. Dubai World signed the debt deal with about 80 creditors to restructure $14.7bn of debt in March 2011.
HSBC, Standard Chartered, Bank of Tokyo Mitsubishi, Emirates NBD and Abu Dhabi Commercial Bank constitute the creditor committee. Dubai World agreed to increase the interest rate it pays on the loans from the average 2.4 per cent fixed agreed to in 2011, so the banks won’t need to take extra provisions on the debt, the people said.
Dubai World plans to present the new plan to other creditors next month, the people said. It needs the consent of at least 67 per cent of the creditors to complete the deal.
A representative for Dubai World declined to comment.
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