Bahrain's GFH in talks to extend $100m loan

Islamic investment house in final stages of negotiations to extend loans by 2-3 years.
Bahrain's GFH in talks to extend $100m loan
LENDER TALKS: Bahrains Gulf Finance House is in talks with lenders to extend a $100m loan that is maturing in August. (Getty Images)
By Frederik Richter
Tue 29 Jun 2010 07:13 PM

Bahrain's Gulf Finance House is in talks with lenders of a $100 million loan maturing in August to extend the facility, its chief executive said in remarks published on Tuesday.

Ted Pretty told IFR, a publication owned by Thomson Reuters, that the Islamic investment house was in final stages of negotiations with the banks to extend the maturity of the loan by two to three years to give the firm more time to revamp its business model and wait for asset prices to recover.

GFH in February at the last moment renegotiated the original $300 million facility provided by the banks by paying back $200 million and extending $100 million by six months.

Bankers and analysts have said GFH was expected to ask for an extension of the new loan as it was unable to implement sufficient asset sales since February to improve its liquidity situation.

In May it sold a stake in the Bahrain Financial Harbour real estate development for $262 million to Emar Bahrain, but this was mostly an asset swap with a cash component of only $40 million.

Like other investment houses in Bahrain and the region, GFH has struggled to generate new business after a regional property boom ended in 2008, sweeping away its business model of relying on fees charged on investor money raised for property and private equity projects. (Reuters)

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