Dana Gas Plans Profit Rate Cut on Sukuk in Restructuring Twist - Bloomberg

Dana Gas Plans Profit Rate Cut on Sukuk in Restructuring Twist - Bloomberg:

"Dana Gas PJSC plans to more than halve profit rates on $700 million of its Islamic bonds after they were found to be non-compliant with religious law, adding a new twist to a debt restructuring initiated in May.

The United Arab Emirates-based energy producer said on Tuesday in a filing that it proposes exchanging $350 million of 9 percent certificates and $350 million of 7 percent exchangeable certificates with a new four-year security paying profit "at less than half of the current profit rates and without a conversion feature."

"Due to the evolution and continual development of Islamic financial instruments and their interpretation, the company has recently received legal advice that the sukuk in its present form is not Sharia compliant and is therefore unlawful under U.A.E. law," the company said. "A restructuring of the current Sukuk is necessary to ensure that it conforms to the relevant laws for the benefit of all stakeholders." "



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