Kuwait's Global Investment House asked creditors to delay
principal repayments on debt due in December, it said on Thursday, as part of a
move to renegotiate a $1.7bn restructuring agreement.
The investment firm also asked to defer an increase in the
rate of interest, starting in December, and waive or defer certain covenants
applicable to Global under its debt arrangements, according to a statement from
Evercore Partners has been appointed by Global to advise it
in the restructuring process, a source with knowledge of the move said on
condition of anonymity.
A creditor committee which will liaise with the Kuwaiti firm
on behalf of the bank group was also set up at a meeting, which took place in
Dubai today between Global and its banks.
Global has so far repaid around $200m under the existing
debt plan, which was signed in 2009, the source added.
However, with $1.5bn still to be repaid and volatile market
conditions making it difficult for banks to make money, Global has taken the
step to complete "a more comprehensive restructuring of Global's debt
The existing restructuring, which Global agreed with 53
local and international banks in 2009, set a tough timetable for the firm and
bankers have long expected a further restructuring would be necessary.
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