Nakheel repays $57m as part of debt deal

Wednesday, 29 August 2012 6:41 PM

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Dubai developer Nakheel said on Wednesday it has repaid AED211m ($57.4m) to lenders as part of its debt restructuring programme.

“The payments were due at the end of August 2012 in accordance with the restructuring commitments," the company said in a statement.

It added: “The timely discharge of the committed payments signals the successful execution of the restructured operations by Nakheel and cements the company’s commitments towards successfully implementing the agreed operating plan following the completion of one of the largest and most complex restructuring in the Middle East in August 2011.”

The indebted state-owned developer said last month that its first-half profits jumped 36 percent, buoyed by property handovers on several projects.

Nakheel, whose extravagant developments at the height of Dubai's property boom contributed to the emirate's debt woes, has been slowly recovering from the crippling real estate collapse.

The developer said net profit was AED767m ($208.82m) in the first six months of the year, up from AED562m in the year-ago period.

Nakheel, builder of man-made islands in the shape of palms and a map of the world, has made cash payments of about AED8.6bn to trade creditors as part of a $16bn debt restructuring plan agreed last year.

The company - brought under direct government control as part of the restructuring of its parent Dubai World - said about 3,500 units have been delivered since the start of the restructuring.

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Posted by: Paolo C Thursday, 30 August 2012 5:50 PM[UAE] - Italy

Great when someone can pay his debts using someone else's money and not fear about legal issues. It's just another bad PR move.

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Posted by: Salvatore Thursday, 30 August 2012 5:49 PM[UAE] - Italy

Nakheel feel they need to stay in the news to satisfy their ego. They come up with anything to confirm to everybody they don't care. No need to insist Nakheel we know that. careless and arrogant like all Dubai developers by the way.

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Posted by: Solly Thursday, 30 August 2012 10:59 AM[UAE] - UAE

Despite the relative modesty of the payment vs debt total as Red Snappa correctly observes, this again shows that Nakheel places more importance on satisfying the bankers than on honouring its debts to suppliers and contractors, and of course its hapless customers....

Posted by: Telcoguy Thursday, 30 August 2012 5:52 PM[UAE] - UAE

Suppliers and contractors have contracts that must be enforced in Dubai, on the other hand international lenders and banks are more likely to be under the jurisdiction of a UK tribunal. And they are also more likely to be able to get an arbitration with the ICSID.

Lacking more detailed knowledge of the contracts, I would suspect the above points can make a difference.

Posted by: Steve R Thursday, 30 August 2012 1:13 PM[UAE] - NZ

correct, couldn't agree more. Suppliers and contractors left to suffer

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Posted by: Red Snappa Thursday, 30 August 2012 9:01 AM[UAE] - Ireland

As a simple country boy from Letrim's observation, fifty seven million USD, appears to be a minor nibble into $16.1 billion of restructured debt, which is agreed to be paid off over 5 to 8 (now almost 4 to 7 )years?

Posted by: Not necessary Thursday, 30 August 2012 10:59 AM[UAE] - UAE

Read again perhaps this is one payment they have paid AED 8.6B so far which is $2.34B or 15% of the debt while that is over 3 years I expect the repayments are accelerating so they might be on track?

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Nakheel repays $57m as part of debt deal

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