Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Dubai Group Said to Repay $300 Million to Citi-Led Creditors

Jan. 2 (Bloomberg) -- Dubai Group LLC, the investment company that has been seeking payment relief on loans for the past three years, repaid a $300 million syndicated facility led by Citigroup Inc., two people with knowledge of the matter said.

Some of the lenders will exit talks on Dubai Group’s $6 billion debt pile, said the people, who asked not to be identified because the information is private. The Islamic loan was secured by a 30.47 percent stake in Bank Islam Malaysia Bhd, which was sold to Kuala Lumpur-listed BIMB Holding Bhd on Dec. 19 for $550 million, according to a statement on the Malaysian stock market.

The repayment follows Dubai Group’s sale of consumer finance company Dubai First to Abu Dhabi-based First Gulf Bank PJSC six months ago. Dubai’s state-linked companies are taking advantage of an economic rebound and selling assets as they tackle more than $40 billion of debt maturing in the next two years. Final documentation for a deal between Dubai Group and its remaining creditors is being prepared and could be signed as early as next week, one of the people said.

A spokeswoman for Dubai Group, who asked not to be identified citing company policy, declined to comment, as did a spokesman for Citigroup.

Spending Binge

Dubai Financial Group LLC, a unit of Dubai Group, acquired a 40 percent stake in Bank Islam for $224 million in October 2006. Its holding was reduced to 30.5 percent in 2009 because Dubai Financial Group opted out of a capital increase.

Dubai, the second-largest of seven sheikhdoms that make up the United Arab Emirates, roiled global markets in 2009 after its near default on $25 billion of debt. State-owned companies such as Dubai Holding LLC, Dubai Group’s parent, and Dubai World Corp. borrowed billions in a spending binge intended to transform the city into the Middle East’s trade and tourism hub.

The emirate’s state-linked debt coming due amounts to about $32 billion this year and $9.6 billion in 2015, according to Bank of America Merrill Lynch estimates.

Dubai Holding, one of three main government-owned holding companies, said in June it plans to sell its 35 percent stake in Tunisie Telecom. Dubai World also sold Atlantis, The Palm Ltd., a hotel on Dubai’s palm-shaped man-made island, to Investment Corp of Dubai last month.

To contact the reporter on this story: Samuel Potter in Dubai at spotter33@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.