Nakheel Gets Dubai Support to Pay $980 Million Bond

Nakheel PJSC, the unit of Dubai World that is restructuring $10.5 billion of debt, said the Dubai Financial Support Fund provided money for the full payment of its Islamic bond maturing May 13.

Nakheel’s floating-rate 3.6 billion dirhams ($980 million) Islamic bond, or sukuk, rose 1.5 percent to 98.5 fils to the dirham after the announcement, according to Mashreq Capital DIFC Ltd. The notes have climbed about 50 percent since Dubai World on March 25 proposed to renegotiate terms of its debt. Nakheel’s statement was posted on Nasdaq Dubai’s website today.

The company and parent Dubai World are renegotiating terms on a combined $24.8 billion of liabilities after the global credit crisis led to a 50 percent slump in property prices and a seizure of global credit markets hampered Dubai-owned companies from borrowing to pay debt. Dubai’s government in March pledged to give $8 billion to Nakheel to help it pay contractors and suppliers and complete projects.