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Dubai World ‘to repay debts over eight years’
Local market closes up 2.78% on news that $22 billion could be repaid in full; Abu Dhabi will finalize another bailout loan ‘over the coming days’.
March 21, 2010 4:24 by Ben Flanagan
Dubai World will ask creditors for eight more years to pay back $22 billion of debt, according to a report in today’s Sunday Times.
Banks will be offered repayment terms of between five and eight years, the newspaper said, without specifying where it got the information.
Abu Dhabi will finalize another bailout loan “over the coming days”, on top of the $10 billion financial support it put up in January, the newspaper said.
Recent reports suggested that creditors could be asked to write off up to 40 percent of their loans, and so the news that the full sum could be repaid “may still come as a relief to some”, according to the newspaper. The rate of interest is still to be decided, but is likely to be at a “commercial rate”.
The Dubai Financial Market index rose by 2.78 percent today, closing at 1,774.43. Traders attributed the rise to speculation that the Dubai World’s restructuring proposal would not disappoint investors.
Sheikh Ahmed Bin Saeed Al Maktoum, chairman of the Dubai Supreme Fiscal Committee, said last week that the package would be “fair”.