Nakheel PJSC, the Dubai World-owned property developer, paid 2.5 billion dirhams ($681 million) of bills it owes trade creditors, Chairman Ali Lootah was cited as saying in an interview with Al Khaleej.
About 80 percent of its trade creditors have agreed to new payment terms, the newspaper said, citing Lootah. Nakheel said on June 30 it had begun settling bills from its biggest trade creditors, involving a payout of 4 billion dirhams. The company is waiting for a final response from bank creditors on restructuring its obligations, Lootah was quoted as saying.
Nakheel PJSC said on July 14 a group of its creditors “unanimously supported” a proposal on altering the terms on $10.5 billion of loans and unpaid bills. The terms are supported “in principle” by the coordinating committee of its creditor banks and Nakheel expects to complete the restructuring over the “coming months,” the company said.
The loans make up part of the overall liabilities that Nakheel is seeking to reorganize, which also include outstanding payments to suppliers and contractors. The offer presented to bank creditors is “final and we won’t go back on it,” Al Khaleej quoted Lootah as saying.
Nakheel and Dubai World, one of the emirate’s three main state-owned holding companies, are seeking to renegotiate terms on their debt after the deepest financial crisis since the 1930s roiled the emirate’s real-estate market and left companies unable to raise new funding. Property prices have fallen more than 50 percent in the city state as banks cut mortgage lending.
Nakheel, which has no plans to sell assets, plans to resume work on six projects in October and is seeking to complete the projects in the next 12 to 15 months, Lootah was cited as saying.