By Ed Attwood
Dubai jeweller remains in final negotiations with bank lenders over $872m debt
Damas International, the largest gold jewellery retailer in the Middle East, has extended a standstill agreement with its lenders until 31 January 2011, it said Tuesday.
The firm is in the process of restructuring around $872m of debt.
“Damas International Limited announces today that the steering committee of its bank lenders has agreed to extend the standstill period for its banking facilities…to 31 January 2011,” said a company statement posted on the Nasdaq Dubai website.
“The company confirms that it remains in final negotiations with bank lenders relating to the company's restructuring plan in respect of its bank facilities.”
Damas has extended the standstill several times since it was initially agreed on 24 March.
In December, Damas reported a six-month net profit of just over $1m, a major turnaround from a year of losses and controversy.
The Dubai-based company, which was founded in 1907, is attempting to recover $165m lost in “unauthorised transactions” from its founders, the Abdullah Brothers.
It was reprimanded by Dubai’s regulator in March, which ordered the firm to dismiss the board and pay fines for failing to exercise proper governance. However, the brothers are still involved in the enterprise and, three months after they were dismissed by regulators, Damas appointed them as senior advisers.
The firm has around 400 stores all over the world.