Dubai Opts for $4 Billion Repayment Over Refinancing as Economy Recovers - Bloomberg

Dubai, which was on the brink of a default in 2009, will repay $4 billion of loans this month as the Persian Gulf business hub opts for repayment over refinancing after economic growth accelerated.

Investment Corp. of Dubai, one of the emirate’s three main state-owned holding companies, will repay the loans when they mature on Aug. 21, the Dubai Government Media Office said in an e-mailed statement today. “The maturing obligation will be repaid from internal sources derived principally from cash dividends received from ICD’s operating subsidiaries.”

Investment Corp. of Dubai began raising a $2.8 billion loan to help repay the $4 billion facility, two bankers familiar with the plan said May 11. Citigroup Inc. (C), HSBC Holdings Plc (HSBA) and Emirates NBD PJSC were coordinating the conventional tranche, while Standard Chartered Plc (STAN) and Mashreqbank PSC (MASQ) were leading the Islamic portion, they said.

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