Dubai’s private equity arm eyes new debt deal

DUBAI International Capital (DIC), the private equity unit of flagship conglomerate Dubai Holding, is seeking a three-month debt delay, it said yesterday, in the latest blow to the emirate’s financial image. The investment unit has a $1.25bn loan maturing in June.

“Dubai International Capital and a coordinating committee of banks today presented to lenders a request for a three-month extension to 30 Sep 2010 of certain maturities,” the company said in a statement.

DIC’s parent Dubai Holding – the conglomerate owned by the emirate’s ruler Sheikh Mohammed bin Rashid Al Maktoum which spans financial investments, hospitality and real estate – is understood to be considering restructuring up to $20bn in debt and is thought to be looking at appointing a financial adviser to explore the rescheduling of loans over the next few months.

Earlier in May, Dubai World, another state-owned conglomerate, reached a deal to restructure $23.5bn in debt with its core lenders, addressing the most immediate of a string of problems facing investors in Dubai. DIC said the extension would create a “consensual longer-term plan”, enabling DIC to maximise the value of its business for its stakeholders.