Little to lose

18 September 2012 By Una Galani Follow @ugalani

Three banks led by Royal Bank of Scotland are suing the ruler’s investment vehicle, Dubai Group, threatening to derail a two-year effort to agree a restructuring of $10 bln. That won’t help them win new business in the emirate, but the banks may still come out with better terms.

This content is for Subscribers only

Context News

Three banks have launched legal proceedings in London against Dubai Group, an investment vehicle owned by the emirate’s ruler which is trying to agree a wider restructuring for debt of $10 billion.
The UK’s Royal Bank of Scotland said on Sept. 12 that it had launched legal action along with South Africa’s Standard Bank and Commerzbank of Germany. Dubai Group is a unit of Dubai Holding, owned by Sheikh Mohammed bin Rashid al Maktoum.
“We do however want to make clear that our preference was always to conclude an agreement without formal legal proceedings and we therefore remain open to such an outcome if an acceptable commercial resolution is forthcoming”, RBS said in a statement.
Dubai Group missed interest payments on two loan facilities in 2010 and has since been in talks with its lenders to extend repayment deadlines.
“Over 35 banks are working towards an agreement and a global term sheet is now being considered by bank credit committees, a number of which have indicated their support”, Dubai Group said in a statement. “We believe that we can reach a consensual agreement with our creditors.”

Context News

Email a friend

Please complete the form below.

Required fields *