UPDATE 1-DP World excluded from Dubai World debt restructuring
DUBAI, Nov 26 (Reuters) - International port operator DP World DPW.DI and its debt are not included in the restructuring of Dubai World, the Dubai government said on Thursday, after announcing it will seek debt delay for its two flagship firms.
On Wednesday, the government said it will ask creditors of Dubai World and property group Nakheel to agree a debt standstill as it restructures the Dubai World group. [ID:nGEE5AO2L1]
"The Government of Dubai has confirmed that DP World and its debt are not included in the restructuring process for Dubai World," a statement said.
Analysts said excluding DP World may be an attempt to shelter the profit-making company and ease shareholder fears it will could be used to sustain less healthy companies.
DP World in October reported a 6-percent fall in third-quarter container volumes and said its 2009 results would be in line with market expectations [ID:nLR393158]
Dubai World is one of the emirate's three big holding firms, along with Dubai Holding and Investment Corporation of Dubai.
In addition to Nakheel, its affiliates include DP World and Istithmar, an investment company with a portfolio of over 50 firms in the financial services, consumer, industrial and property sectors. [ID:nGEE5AO22V]
Restructuring the emirate's biggest corporate debtor, Dubai World, and delaying repayment on some of the company's $59 billion of liabilities could signal a broad restructuring of the emirate's corporate landscape.
The government said on Wednesday that Dubai World would ask all providers of financing to itself and Nakheel to extend maturities on debt until at least May 30 next year. That appears to affect about $5.7 billion of debt due to mature before the end of May. [ID:nGEE5AO2L1]
A number of government-linked companies, such as Dubai World and Nakheel, have generated spectacular growth for the emirate's real estate, shipping, transport and financial sectors over the past two decades. [ID:nGEE5AO22V]
Now part of that constellation of companies could be broken up as Dubai struggles under its massive debt load. In some cases, firms could be dismembered or partially privatised. (Reporting by Tamara Walid) ((tamara.walid@thomsonreuters.com; +971 4 391 8301; Reuters Messaging: tamara.walid.thomsonreuters.com@reuters.net))
