Thursday, May 03, 2012
(This story was originally published Wednesday.)
DUBAI (Zawya Dow Jones)--Dubai's Jebel Ali Free Zone is asking holders of its 7.5 billion U.A.E. dirham ($2.04 billion) Islamic bond to allow it to redeem the debt early.
In an announcement posted on the Nasdaq Dubai website Wednesday, the trustee of the Jafza sukuk invited a vote on an extraordinary resolution to "amend the conditions of the certificates to provide for early redemption." The sukuk matures in November.
The proposal was made to give Jafza flexibility in setting up a refinancing package, the statement said.
Jafza "is in advanced discussions with a group of financial institutions in relation to a financing package," it said.
"The trustee is proposing the introduction of a call option to provide JAFZ with enhanced flexibility to implement the new financing in a timely and efficient manner and to allow the timing of the dissolution of the underlying trust to be coordinated with the new financing," it said.
Jafza has been in discussions with banks for months about a financing package to replace its $2 billion sukuk, but has yet to finalize the deal.
The sukuk is one of a number of large debts coming due this year for Dubai's government-related companies. The International Monetary Fund estimates Dubai and its related companies face around $15 billion of maturities this year.
Holders of Jafza sukuk would be entitled to a "consent fee" of AED100 per AED100,000 of principal if they vote in favor of the early redemption resolution by May 14, the document said. A meeting of sukuk-holders has been scheduled for May 24 to make a final vote on the proposal.
-By Asa Fitch, Dow Jones Newswires, +971 4 446-1685, asa.fitch@dowjones.com
Copyright (c) 2012 Dow Jones & Co.
(END) Dow Jones Newswires
03-05-12 0351GMT
