Nakheel begins cash repayment

Nakheel begins cash repayment

Dubai World company starts 40 percent repayments to trade.

June 30, 2010 3:29 by Samuel Potter

Nakheel has begun repaying trade creditors, according to a press release from the company today.

The Dubai World-owned company will be distributing up to AED 4 billion in the coming two weeks to trade creditors who have accepted its proposed financial restructuring.

Trade creditors owed more than half a million dirhams have been offered full repayment by the developer – 40 percent in cash and 60 percent via an Islamic bond with a 10 per cent annual return. Bonds are expected to be issued in the coming months.

“We are delighted to commence making the 40 percent cash payments to our trade creditors,” said Nakheel chairman Ali Lootah. “Today’s announcement marks significant progress in our recapitalization plan, following on from the initial payments to trade creditors of AED 500,000 or less, which commenced in March 2010.

“This progress could only have been achieved with the continued support of HH Sheikh Mohammed bin Rashid Al Maktoum, UAE Prime Minister and Vice-President, and Ruler of Dubai; the Dubai Government; and the Dubai Supreme Fiscal Committee (DSFC); and of course, we thank our partners for their continued patience and understanding during the restructuring process.”