Tuesday 6 December 2011

Dubai may use sovereign fund to repay debt | Reuters

Dubai, which narrowly averted a bond default in 2009, could use money raised by its sovereign wealth fund to help repay $3.8 billion in bonds owed by state-linked firms which mature next year, a source familiar with the matter said on Tuesday.

The Gulf Arab emirate has clawed its way back from the depths of its debt crisis, helped by an economic revival in trade and tourism and its safe-haven status amid the Arab Spring revolts, but still faces the challenge of big debt repayments.

The source said discussions in government circles focus on $3.8 billion in bonds due next year from a trio of state-linked firms which are seen as having the highest refinancing risk -- Dubai Holding Commercial Operations Group (DHCOG), part of the ruler's private holding company, DIFC Investments (DIFCI) and Jebel Ali Free Zone (Jafza).

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