Dubai World and creditors in rate ‘stand-off’

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Dubai World has met its leading creditors for the first time since it tabled a $23.5bn debt restructuring plan last month, according to people with knowledge of the talks.

The talks, in Dubai this week, were to negotiate further the terms of the plan. While the company is proposing to reschedule its debts over five to eight years, while cutting the interest paid to 1 per cent per annum, its lenders want a change to the terms, the sources said.

Some of the banks would like an increase in the interest rate and a reduction of the time over which they are repaid under the proposals.