Mar 23 2011 |
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Meydan funding to spur markets
Wednesday, Mar 23, 2011
Gulf News
Dubai The rate and tenor of IDBI Bank’s $120 million (Dh440 million) loan to Meydan to develop a new residential community within the master-development will cheer the markets, according to the financial institution’s CEO.
“There are a lot of associated factors at work before deciding on the loan terms — the tenor, the interest rate environment, the wider situation and the project itself,” said N. S. Venkatesh, CEO of IDBI Bank DIFC branch.
As far as projects go, Meydan has a lot in its favour, which will be reflected in the loan terms and will be very competitive. The [financial] markets will be happy with what will come out.”
The funding will be used to develop 528 town houses and associated facilities in the Meydan Heights cluster.
Strategic fit
“We will start releasing the funds in tranches as the project reaches key milestones,” said Venkatesh.
“There’s a strategic fit that we have with Meydan and it’s a partnership that will have several chapters getting added with time.”
In mid-February Meydan brought IDBI Bank on board in an advisory and project financing capacity. The $120 million financing represents the first of more to come, according to top officials on both sides.
IDBI Bank’s office in DIFC , which is the Indian government owned institution’s first outside its home market, did the groundwork.
The bank, which is into industrial and infrastructure financing, is making a push to tap opportunities outside India.
Currently, its overseas exposure is less than 5 per cent of the total.
“The initial approach was made six months ago, though at that stage it was strictly on a non-committal basis,” said Saeed Humaid Al Tayer, chairman and CEO of Meydan Group .
“We invited IDBI Bank to come and evaluate our plans and the indicators were right to formalise the partnership. A partnership approach responds best to market needs.”
Megan Hirons Mahon/Gulf News
Hand in hand
Saeed Humaid Al Tayer, Chairman of the Board and CEO of Meydan and N.S. Venkatesh, CEO, IDBI Bank DIFC branch seal their partnership with a handshake.
Partnership
Project
right on track
The Meydan Group does not have any payments outstanding to its contractors, according to a top official.
“Instead what we have is expectations on project deliveries that were contracted,” said Saeed Humaid Al Tayer of Meydan Group . “With those contractors who have stayed the course, we are in the for the long term.
“But for those who have deviated from the contracts at the 11th hour or walked away, there are obligations they need to honour. We have our own processes to deal with such situations.”
— M.N.
We invited IDBI Bank to come and evaluate our plans and the indicators were right to formalise the partnership. A partnership approach responds best to market needs.”
Saeed Humaid Al Tayer
CEO, Meydan Group
By Manoj Nair Associate Editor
© Gulf News 2011. All rights reserved.
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