By Tamara Walid
'The standstill is in the final stages of being extended until the end of September.'
UAE-based jeweller Damas International expects to sign an extension with lenders to its standstill agreement on $872 million of debt by the end of next week, its chief executive said on Thursday.
"The standstill is in the final stages of being extended until the end of September," said Anan Fakhreddin. "Everybody is in agreement." The extension would serve as an "interim arrangement to negotiate" debt restructuring, he added.
Damas has been in talks with banks to restructure its debt and has been operating under a standstill agreement. The lenders, some 20 banks, include foreign names like Barclays and BNP Paribas.
News on the debt deal comes as the Dubai-based firm attempts to recover $165 million lost in "unauthorised transactions" with its founders, the Abdullah Brothers. Dubai's regulator in March ordered Damas to dismiss the board and pay fines for failing to exercise proper governance.
The three Abdullah brothers, Tawhid, Tawfique and Tamjid Abdullah, missed the first scheduled repayment of $55 million due in April.
Fakhreddin said the company had made "good progress" on recovering assets outside its home market and planned to issue related figures soon.
The jeweller appointed the company's founding brothers as senior advisors in June, months after Dubai's regulator ordered their dismissal on financial irregularities. (Reuters)