Dubai-based investment bank Shuaa Capital has said it resolved a dispute with Dubai Banking Group (DBG) over a 1.5 billion-dirham ($408m) bond conversion, it was reported on Thursday.
Shuaa will issue 515 million shares to Dubai Banking at 2.91 dirhams each, Shuaa said in an e-mailed statement to newswire Bloomberg. It would give Dubai Banking a 48.4 percent stake of Shuaa’s share capital after the bond conversion.
The one-year bonds, issued by the UAE’s biggest investment bank in 2007 to Dubai Banking, were initially scheduled to be converted into 250 million shares at 6 dirhams each on Oct. 31, 2008.
DBG announced on Tuesday it had initiated legal proceedings against Shuaa over the investment bank’s decision to convert a AED1.5bn dirham bond it had issued to DBG in 2007 into shares.
Shuaa denied any amounts were due to DBG, saying it had already exercised its contractual option to redeem the bonds by issuing 250 million new shares.
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