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Mon 29 Nov 2010 10:16 AM

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Dubai mulls privatisation plan to avert debt

Senior officials say some international assets on the cards as well as privatising government firms

Dubai mulls privatisation plan to avert debt
"We continue to work to diversify our revenue base and broaden the space for participation in the wealth of our economy," said HH Sheikh Ahmed Bin Saeed Al Maktoum, the head of Dubais Supreme Fiscal Committee.

Dubai is considering privatising some of its public sector firms as well as selling international assets, senior officials are reported as saying.

"We continue to work to diversify our revenue base and broaden the space for participation in the wealth of our economy," said HH Sheikh Ahmed Bin Saeed Al Maktoum, the head of Dubai's Supreme Fiscal Committee, according to a report by AFP news agency.

"We (continue to) work on opening the door for public subscription in some of our large companies," he said.

Sheikh Ahmed was speaking at the Dubai economic update forum meeting on the eve of the anniversary of the Dubai World debt announcement, which sparked jitters across global stock markets when the company requested a standstill on debt repayments.

The conglomerate has since reached a restructuring deal for about $24.9bn of debt with banks agreeing to reschedule some $14.4bn of debt over five and eight years.

"According to the Dubai World plan, there is a possibility of selling some assets," Mohammed Al Shaibani, director of the Dubai Ruler's Court, told the news agency. "All this going to be reviewed by the time we are ready to do so," he said.

Shaibani told AFP the possibility of privatising some government firms was also being evaluated.

"There might be a privatisation plan. We are working on this with the government,” he was reported as saying.

Peter Cooper 8 years ago

Building up selected companies for privatization in the near future makes sense, but not dumping shares on a depressed local stock market now. In order to boost local business confidence some of the worst companies from the boom need to actually fail or be wound up. Only then will investors be confident that the bad news is behind us, shares will go up and privatization will be welcomed by a rising stock market... see:

http://www.arabianmoney.net/private-equity/2010/11/29/how-viable-is-a-privatization-plan-for-dubai/