Dubai determined to complete P&O deal

Dubai Ports World indicated yesterday that there is no chance of it walking away from its takeover of the ports group P&O, despite a growing political storm over the deal in the US.

As George Bush threatened to use his presidential veto if Congress tries to block the deal on security grounds, DP World has been quietly raising its stake.

It has snapped up 19 million shares in recent days, taking its stake from well under 2 per cent to about 5 per cent, in a sign of its confidence that the £3.9bn offer will close as agreed.

The White House was at pains yesterday to point out that the deal, which includes contracts to run six ports in the US, has been cleared by the FBI and other bodies. But it did concede that Mr Bush had been unaware of the deal until after his administration had given its approval.

One banker dismissed the fuss as "electioneering", pointing out that US coast guards remain in charge of port security. The worst-case scenario is that DP World has to sell some of the six ports to assuage concern, but even this seems unlikely and will not affect the price of the deal. A UK court is expected to rubber stamp the takeover on Monday.

Several politicians are backing a vote to suspend approval of the deal. However, the President made no moves to back down. His officials said Dubai was an ally in the war on terror and security.

Leading Arab businessmen warned a ban would be interpreted as double standards tantamount to racism. The Egyptian owner of Italy's mobile firm Wind, Naguib Sawiris, told Bloomberg: "This may have a very negative effect ... It will send a message to all Arab investors, that will make themcautious to go to the US."