Dubai World names its debt target
The parent company of container terminal operator DP World is in talks with lenders to restructure $26 billion of its $59 billion in debt, according to a Bloomberg report Tuesday.
Dubai World, which last week announced it was seeking a standstill agreement on a large proportion of its debt, again reiterated that its cargo-related activities ' namely DP World and its Jebel Ali Free Zone Authority subsidiary ' would be cordoned off from the restructuring.
Also this week, the Dubai government said it would not bail out state-owned Dubai World, but also sought to tamp down panic over the extent of the company's woes. In the announcement last week, no figure was given as to how much of its debt Dubai World was seeking to restructure.
Analysts indicated in the Bloomberg report that the detailed figure would ease concern, not just in Middle East markets, but in global ones as well. The most tenuous debt is wrapped up bonds used to fund expensive construction projects undertaken by Nakheel, another subsidiary of Dubai World.
DP World, the world's fourth-largest terminal operator, has been under the microscope since the announcement Nov. 25, but executives have said the profitable business will not be restructured or sold to compensate for losses in other parts of the conglomerate.