Troubled state conglomerate Dubai World has invited creditors to a July 22 meeting to offer details on its multi-billion dollar debt restructuring, the first session to include all lenders since December 2009. Three sources from among the group's 80 creditors told Reuters they had received the invitation via the co-ordinating committee of seven banks that hold 60 percent of Dubai World's $14.4 billion in bank debt.
The flagship state conglomerate, which shocked investors in November with news it could not pay its debts, will try to secure wider backing from the meeting for the outline restructuring deal struck with a co-ordinating committee of lenders in May.
The May deal allows banks to get their money back in two tranches with five and eight-year maturities. Ahead of the crisis the debt was mostly due by the end of 2011
The broader meeting is more than three weeks behind schedule after creditors were told to expect it in June. Before the financial crisis struck the region, Dubai World for years expanded aggressively, mostly on borrowed money, until liquidity dried up and the value of its real estate assets plummeted.
Dubai World's problems opened a window on some broader debt problems facing the Gulf Arab emirate, hit hard by a region-wide real estate slump after years of expansion at breakneck speed through ambitious real estate projects including man-made holiday islands in the shape of palms.
Last week, the lossmaking main unit of Dubai Holding, which groups the personal business empire of the emirate's ruler Sheikh Mohammed bin Rashid al-Maktoum, said it would not be repaying a loan that had fallen due.