Dubai World yesterday insisted that talks with its creditors had been positive, despite failing to reach agreement with more than 90 banks on the terms of a six-month standstill deal for its $22bn (£13bn) of debts.
The State-owned business met its creditors for the first time since last month's announcement of its plans to seek a six-month holiday on debt repayments plunged world markets into chaos for several days.
It is negotiating with a committee of large creditors, which has representatives from four UK banks – HSBC, Lloyds, Royal Bank of Scotland and Standard Chartered – as well as many smaller lenders, which are thought to be more reluctant to agree to the standstill arrangement.
Dubai World said it had not presented the terms of its standstill plans in full to creditors yesterday but that it expected to be able to offer a detailed package of restructuring proposals within the next few weeks.
The group bought itself some time last week with a $10bn loan from Abu Dhabi, the largest state in the United Arab Emirates, that enabled it to repay one $4m bond and to finance working capital into next year. But it remains unclear to what extent the company will enjoy the support of Dubai itself, while Abu Dhabi has made it clear that it requires it to come to an agreement with creditors. A spokesman for Dubai World said last night that it was "committed to working closely with the banks' appointed co-ordinating committee to work towards a consensual solution".
Investors on local markets were unperturbed by the initial failure of Dubai World to reach agreement with its creditors. The Dubai market fell back in early trading but had recovered by the end of the day.Reuse content