Arab Today, arab today drydocks world 22b debt restructuring deal faces risks
Last Updated : GMT 09:14:27
Arab Today, arab today
Arab Today, arab today

Drydocks World $2.2b debt restructuring deal faces risks

Arab Today, arab today

Arab Today, arab today Drydocks World $2.2b debt restructuring deal faces risks

Dubai - Arabstoday

A potential $2.2 billion (Dh8 billion) debt restructuring for Drydocks World, the shipbuilding arm of Dubai World, is seen facing tough headwinds with the presence of hedge funds and other issues seen threatening an amicable deal. Drydocks has set up a committee to thresh out an agreement for the restructuring of its $2.2 billion debt pile. The firm missed a payment deadline for a $1.7 billion three-year loan facility that it took in October 2008. It also has another five-year $500 million facility on the restructuring table. But a potential debt accord may be hampered with a large portion of the loans getting offloaded by banks to hedge funds in secondary market deals. The loans last exchanged hands at 49 cents to the dollar in September, one secondary market loans trader said. \"Some of the lending bank consortium members have sold the loans to international hedge funds ... This will make an amicable restructuring deal difficult for the company,\" said Suketu Sanghvi, head of structuring and investments at Essdar Capital in Dubai. Reputation risks \"The international hedge funds are unlike the commercial banks or regionally based fund managers. These funds do not invest for long-term relationships and are usually not concerned about reputation risks associated from dealing with distressed borrowers or their governments through litigation routes.\" Bookrunners in the 15-lender syndicate were BNP Paribas, HSBC Mashreq, Standard Chartered and Lloyds TSB among others. \"We are working with all our lenders across the board and hopefully we can come up with a solution. We are in serious discussions and we are committed to completing the restructuring in a fair manner,\" Khamis Juma Bu Amim, chairman of Drydocks World, told Reuters yesterday. He said the restructuring could be completed as early as the first quarter of 2012. The restructuring has dragged on for months after the company said earlier it expected to complete the deal by end of April and had agreed on headline terms with banks. Government-related and private companies in the region have so far avoided restructuring by agreeing with creditors to extend maturities — a practice labelled \"extend and pretend\" by some bankers. This method has helped banks avoid billions of dollars in writedowns and enabled companies to avoid the embarrassment of a debt restructuring. But with hedge funds coming into the picture, demands may get even more stringent, bankers say. \"[Hedge funds] are not interested in sipping coffee at the [Dubai International Financial Centre] and hoping for repayment six years later. They are likely to force asset sales and timely repayments,\" one Dubai-based banking source familiar with debt restructurings in the region said, speaking on condition of anonymity. One New York-based distressed debt investor, Monarch Alternative Capital, has sued Drydocks in a London court seeking claims of $45.5 million. \"It is regrettable that this one lender decided for unclear reasons to take legal action. The company is reviewing its options and no doubt it will defend the case,\" Drydocks said in a statement in October. A potential restructuring poses big challenges for Drydocks World, which is seen as a non-core asset by the Dubai government and is unlikely to receive any support. Parent Dubai World has itself restructured $25 billion in debt, pushing back repayment to between five and eight years. Drydocks World was not included in its restructuring. When asked if the company was looking at the sale of assets for repayment, Bu Amim said: \"We are looking into strategic profiling of different assets but this is regular business,\" adding there had been no specific discussions on asset sales.

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today drydocks world 22b debt restructuring deal faces risks Arab Today, arab today drydocks world 22b debt restructuring deal faces risks

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today drydocks world 22b debt restructuring deal faces risks Arab Today, arab today drydocks world 22b debt restructuring deal faces risks

 



Arab Today, arab today
Arab Today, arab today Youssra depended on colored foam

GMT 16:53 2017 Tuesday ,05 September

Youssra depended on colored foam
Arab Today, arab today EasyJet, Lufthansa among seven to bid

GMT 06:49 2017 Tuesday ,17 October

EasyJet, Lufthansa among seven to bid
Arab Today, arab today Etiquette expert underlines importance of gifts

GMT 17:52 2017 Sunday ,03 September

Etiquette expert underlines importance of gifts
Arab Today, arab today Israeli court convicts Palestinians of 2016

GMT 04:39 2017 Tuesday ,17 October

Israeli court convicts Palestinians of 2016
Arab Today, arab today Iran's Facebook shuts down

GMT 23:50 2017 Monday ,16 October

Iran's Facebook shuts down
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Sidem reveals plan to improve education

GMT 15:52 2017 Friday ,06 October

Sidem reveals plan to improve education
Arab Today, arab today British actress becomes fifth woman

GMT 18:15 2017 Monday ,16 October

British actress becomes fifth woman
Arab Today, arab today Three killed, 360,000 without power

GMT 05:11 2017 Tuesday ,17 October

Three killed, 360,000 without power
Arab Today, arab today The history of solar eclipses

GMT 05:16 2017 Sunday ,20 August

The history of solar eclipses
Arab Today, arab today Mercedes says recalls 400,000 UK cars

GMT 06:56 2017 Tuesday ,17 October

Mercedes says recalls 400,000 UK cars
Arab Today, arab today Britain's Vauxhall to cut 400 jobs

GMT 10:53 2017 Sunday ,15 October

Britain's Vauxhall to cut 400 jobs
Arab Today, arab today Anoshka happy for reactions to her talk show

GMT 12:33 2017 Friday ,13 October

Anoshka happy for reactions to her talk show
Arab Today, arab today India to close colonial-era military farms

GMT 18:49 2017 Monday ,16 October

India to close colonial-era military farms

GMT 10:55 2017 Thursday ,12 October

Safaa Sultan happy for “Love School”

GMT 10:37 2017 Thursday ,12 October

Cara Delevingne accuses Weinstein

GMT 16:53 2017 Saturday ,02 September

Mai importance of gifts during Eid Al-Adha

GMT 12:02 2017 Saturday ,14 October

Conservation cutbacks put Brazil's

GMT 10:46 2017 Saturday ,05 August

Nanis reveals simple ideas for home renovation

GMT 12:25 2017 Saturday ,14 October

Squeeze on UK health gives advanced

GMT 07:02 2017 Sunday ,15 October

German minister sparks uproar

GMT 17:12 2017 Monday ,07 August

Al-Shawaifi reveals secrets of total solar eclipse

GMT 03:59 2017 Sunday ,15 October

US mobile carriers Sprint, T-Mobile to merge

GMT 11:37 2017 Saturday ,12 August

Fashion designer reveals her new collection
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday