Dubai Won't Step to Front of Debt Line

* username: rupertbu

Dubai's government said Monday it won't seek senior creditor status in restructuring talks now under way between Dubai World and lenders, a position that may help simplify negotiations with creditors over some $22 billion of the company's debt.

Dubai World shocked investors in early November saying it would ask for a six-month debt standstill. In December, neighboring Abu Dhabi, the capital of the United Arab Emirates, extended Dubai a $10 billion lifeline, following a separate $10 billion infusion by the federal government last February.

Since then, Dubai has pumped more than $6 billion into Dubai World, its flagship corporation, with businesses spanning ports, private equity and real estate. The government has paid off maturing debt and unpaid bills from contractors; serviced debt payments and paid advisory fees for both the company and its creditors during restructuring talks that began in December.