Friday 20 February 2009

United front on Borse Dubai sends right signals

Cash is king in today’s turbulent markets. So reports that Borse Dubai, Dubai’s stock market operator, has managed to borrow US$2.5 billion (Dh9.18bn), analysts say, may indicate that Dubai Inc may be in a better position than the rumour mill would have had you believe.

Borse Dubai, the state-owned majority owner of Dubai’s two stock markets, has reportedly closed a one-year, $2.5bn syndicated loan this week, just days before it is due to pay back $3.4bn in previous debt. Amid tight international credit markets and lingering concerns about Dubai’s debt load, foreign banks kicked in $1.2bn in loans, according to a Reuters report from London. The remaining $1.3bn came from Dubai’s own banks, the report said.

Equally important, analysts say, is where Borse Dubai appears to be getting the other $900 million it needs to make next week’s debt payment – from its shareholder, the Dubai Government.

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