Nakheel, the developer behind man-made islands off Dubai’s coast, has delayed its planned Islamic bond due to administrative issues, the company said Thursday.
The real estate arm of debt-laden conglomerate Dubai World had been expected to issue the $1.63bn Islamic bond, or sukuk, by the end of June.
“It is taking longer than expected to close all the required steps to complete the administrative processes associated with the issuance of the sukuk,” a Nakheel spokesman said in an emailed statement to Arabian Business.
“Therefore as soon as it is practical, the sukuk will be issued.”The firm did not specify a new timeframe.
Nakheel was one of the biggest casualties of Dubai’s real estate collapse, which saw prices halve from their 2008-peak and almost half of developments in the emirate cancelled.
The developer’s inability to meet its debt obligations in the wake of a property collapse and the global credit crunch, helped trigger Dubai's debt crisis in 2009.
The firm, which is seeking to delay some $10.8bn of debt, said in June it had won near-unanimous approval from trade creditors representing 95 percent of the debt.
The developer has offered trade creditors repayment of 40 percent cash and the remaining 60 percent in the form of a sukuk.
The sukuk is already being offered at a 20 percent discount in the secondary market by some trade creditors.
Once its restructuring is complete, Nakheel’s ownership will move from Dubai World to the emirate’s government.
From / Arabian Business News