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Friday, 12 November 2010

Cost of insuring Dubai debt spikes to two-month high | Reuters

The cost of insuring Dubai sovereign debt against default or restructuring rose to a two-month high after news that a company in one of the Gulf Arab emirate's conglomerates had missed two payments on separate loans in recent weeks.

Five-year credit default swaps (CDS) for Dubai spiked 30 basis points from the previous close to 440 basis points, according to CDS monitor Markit.

Sources told Reuters that financial services firm Dubai Group had missed two payments on separate loans in recent weeks, including one arranged by Citibank (C.N). [ID:nLDE6AA0DS]"

New era for restructuring dawns in Dubai

"Regretfully, the excellent graphics of the printed edition are not available on-line." RNB

On the eve of Eid last year, Dubai World sent shockwaves through global markets when it asked creditors for a standstill on billions of dollars in debt obligations.

A year later, the emergence of another debt restructuring story at another Dubai conglomerate is unlikely to create the same tremors.

Dubai Group, one of three main branches of Dubai Holding, said yesterday it had appointed a creditors' committee to start talks about a debt restructuring. It marked the first such move at a major government-linked group since Dubai World began its US$24.9 billion (Dh91.44bn) restructuring.

Mubadala Oil Unit to Tap Middle East for $300 Million in Revenue, CEO Says - Bloomberg

PSN Emirates, an oil-services venture controlled by Mubadala Development Co. of Abu Dhabi, aims to generate more than $300 million in revenue over the next five years, its chief executive officer said.

PSN Emirates will bid for maintenance contracts in Saudi Arabia and Qatar as it plans expansion in the Middle East, home to more than half of the world’s oil reserves, David Clark said in a Nov. 1 interview in Abu Dhabi.

Mubadala, a government-owned investment company, formed PSN Emirates in 2008 in a joint venture with Production Services Network Ltd. of Aberdeen, Scotland, to provide oil services as part of its oil and natural-gas business. In the same year, Mubadala created Petrofac Emirates, a separate venture with Petrofac Ltd., a London-based oilfield services business. - Dubai Group misses interest payment

Dubai Group, an investment arm of one of the emirate’s troubled conglomerates, has missed an interest payment on a $330m loan, potentially triggering a cross-default on other debts.

Dubai Group is part of the Dubai Holding conglomerate that is owned personally by Sheikh Mohammed bin Rashid al-Maktoum, Dubai’s ruler. It has gross debts of about $12bn, and several parts of the conglomerate are negotiating with creditors over revised payment plans. But the missed interest payment came as a surprise to bankers.

One senior banker familiar with the situation said he expected Dubai Group would settle the interest payment within the grace period of five working days – which in effect is about 10 days given next week’s Eid al Adha holiday in the Gulf – but said that the missed payment was “clearly a concern”.

Qatari issuers tap strong demand for Qatar | Reuters

Robust appetite for Qatari paper has led a wide spectrum of the country's companies to tap debt markets recently, with a slew of further issuances expected in coming months, bankers said on Thursday.

The Gulf state has seen a flurry of new issues in recent months as companies seized strong international demand for Qatari debt, with many issues substantially oversubscribed.

Qatar Telecommunications Co QTEL.QA launched a $1.5 billion bond sale in October which drew subscriptions exceeding $15 billion. The demand led the company to tap a further $1.25 billion dual-tranche bond days later. Qatar National Bank's QNB.QA five year, $1.5 billion offering was nearly four times oversubscribed earlier this week."