NBQ asks Global Investment House to pay up

PAY UP: Kuwait's Global Investment House asked by NBQ to meet full payment under 2008 stake purchase deal. (Getty Images)

UAE's National Bank of Umm al-Qaiwain (NBQ) said on Tuesday it is seeking the full payment of 2.36 billion dirhams ($642.5 million) from Kuwait's Global Investment House under a 2008 stake purchase deal.

Global and NBQ said in August that Global planned to buy a 20 percent stake in NBQ through convertible bonds worth 2.36 billion dirhams.

NBQ's CEO Sheikh Nasser bin Rashid al-Moalla told Al Arabiya television that Global could seek arbitration if it wanted to pull out of the stake purchase.

Global could not be reached immediately for comment.

"We are bound by the agreement ... which has clauses for arbitration in case of a dispute and we asked our brothers in Global a long time ago, but they are worried about resorting to arbitration," Sheikh Nasser said.
 
"We have not issued the mandatory convertible bonds because to issue them the full payment of 2.359 billion dirhams has to be made, while they only have paid 918 million ... We are demanding the payment of the remaining amount," he added.

The two firms had said in August they had yet to secure final regulatory approval for the transaction and that no timeframe had been set for Global to convert the bonds.

Global, Kuwait's biggest investment bank, said in March it was confident of reaching deals with creditors to restructure and rescheduled its debt after saying in January it defaulted on most of its loans.

Abu Dhabi-listed NBQ, is 30 percent owned by the government of Umm al-Qaiwain, the smallest of the seven emirates comprising the UAE. (Reuters)

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