Saudi debt restructuring sets precedent - FT.com

A restructuring of billions of dollars of debt at a leading Saudi Arabian steel manufacturer has set a new precedent for complex financial restructurings in the kingdom, lawyers say.

Last week, Al-Ittefaq Steel Products Company and 18 banks reached an out-of-court agreement to refinance about SR7.5bn ($2bn). Under the arrangements, none of the banks will take write-offs and the company will be able to continue some of its expansion plans.

"This is a landmark transaction in proving that a financial restructuring can actually be done in Saudi Arabia,” says Christopher Langdon, a partner with Latham & Watkins, which represented banks involved in the deal.

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