Dubai World has secured approval from 73.01 per cent of creditors for its plan to restructure US$14.6 billion of debt, the conglomerate’s lawyers said in a court hearing yesterday.
Mark Hyde of Clifford Chance, told the Dubai World Tribunal yesterday that creditors representing 66.92 per cent by value had already signed lock-up agreements for the terms of the restructuring deal.
Dubai government-related entities such as the Dubai Financial Support Fund will not vote on the proposal.
A provisional date of March 17 was set by the tribunal for a creditor vote to approve the deal, which is expected to be closed early in May.
Creditors have until February 8 to sign up to the deal to receive an incentive fee.
The next hearing in the matter is scheduled to take place on February 15.
Dubai World announced on Monday that it was filing a company voluntary arrangement in the Dubai World Tribunal to win approval for its debt restructuring plan, enabling it to push the deal through in the face of objections for a minority of creditors holding out for improved terms
The tribunal was established by Decree 57 in December 2009, and provided the conglomerate and its subsidiaries with a legal framework for restructuring arrangements without unanimous creditor approval.
Under the terms of Decree 57, just 66.67 per cent of creditors by value are required to approve arrangements for them to come into force.
Mr Hyde told the tribunal that Dubai World has more than 130 creditors, and that the process of getting approvals from all of them is “likely to be extremely challenging”.
Dubai World’s new deal will involve the early repayment of about $2.9bn of debt due by September this year, and an extension of the repayment date for a further $10bn of debt, originally due in 2018, by an extra four years.
About $1.8bn has already been repaid to creditors from the proceeds of asset sales over the past year.
jeverington@thenational.ae
* with Bloomberg News
Follow The National's Business section on Twitter