Dubai’s ICD Said to Seek $880 Million Atlantis Debt RefinancingMatthew Martin and Dinesh Nair
Investment Corporation of Dubai, the emirate state-owned holding company, is seeking to refinance an $880 million loan taken out by resort hotel Atlantis, The Palm, according to four people with knowledge of the matter.
The company hired HSBC Holdings Plc, Standard Chartered Plc, and Emirates NBD PJSC on the deal, three of the people said, asking not to be identified as the talks aren’t public. The company is seeking a significant cut on the 5.5 percent above the London interbank offered rate price it has on the existing deal, three of the people said. The new loan could be increased to about $1 billion, one of the people said.
Companies in Dubai are benefiting from resurgent confidence in the economy and abundant liquidity at the local banks to lower borrowing costs. Jebel Ali Free Zone FZE lowered the rate it pays on a 2.2 billion-dirhams ($599 million) Shariah-compliant loan by 50 percent, three bankers familiar with the deal said earlier this month. Emaar Malls, the retail arm of Emaar Properties PJSC, said in June it had raised a $1.5 billion loan priced at 1.75 percent above Libor that would be used to refinance a smaller and more expensive loan.
The Atlantis, The Palm resort is located on one of the artificial palm-shaped islands off Dubai’s coast. It spent $20 million on its opening party in 2008 and the new loan will be used to refinance existing debt originally taken out to fund construction. ICD acquired the resort Dubai World, another Dubai government holding company, at the end of 2013.
Officials at ICD and Atlantis, The Palm, didn’t respond to calls and an e-mail seeking comment. HSBC, Standard Chartered and Emirates NBD declined to comment.