Wednesday, Jan 26, 2011

(Adds chairman quote, details.)

DUBAI (Zawya Dow Jones)--Nakheel, the real-estate unit of Dubai government-owned conglomerate Dubai World, said Wednesday it had repaid its $750 million Islamic bond, or sukuk, that matured on Jan. 16, after securing sufficient funds from the Dubai Financial Support Fund in December.

"Yes, we have paid it," Nakheel chairman Ali Rashid Lootah said at a Dubai press briefing.

The Dubai Financial Support Fund was set up last year to distribute funds to struggling government-related entities via a $20 billion sovereign bond program.

Nakheel is seen to be at the center of the financial problems that have plagued its parent Dubai World, which is in the process of restructuring nearly $25 billion of debt, since its shock announcement in November 2009 that it was seeking to delay debt payments. The struggling property company in late 2009 narrowly avoided default on a $3.52 billion bond.

"We have money in the bank. We have fixed deposits in the bank. We will not need any more additional commitment from the Dubai government than what the government committed to us in the past," Lootah said.

Nakheel continues to work towards securing approval from all of its trade creditors as part of the company's debt restructuring plan, he added.

"We are in process of negotiations with our creditors. We are about to sign a major contractor soon. Officially, we reached 91% overall agreement. Within two weeks I hope to finish all agreements with creditors," Lootah said.

Nakheel in October said it had secured approval from 90% of its trade creditors for the plan.

Nakheel's trade creditors last year were offered repayment through a mix of 40% cash and 60% in a sukuk, with a 10% annual return, as part of the debt restructuring.

"The $6 billion sukuk--we are almost there, we are working on it," Lootah said. "The sukuk will be listed, I hope, on Nasdaq Dubai soon."

He added that there are no plans at this stage for an initial public offering of the company's shares.

-By Leila Hatoum, Dow Jones Newswires; +971-4-446-1686; leila.hatoum@dowjones.com

Copyright (c) 2011 Dow Jones & Co.

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26-01-11 0854GMT