Dubai Duty Free eyes $1.5bn loan
Dubai, May 22, 2012
Airport retailer Dubai Duty Free (DDF) has increased the size of a multi-tranche loan facility it is currently raising to $1.5 billion, driven by high interest from local and international lenders, said a senior government official.
"We are raising $1.5 billion and we are getting almost close to double that in terms of interest but hasn't been concluded yet," Mohammed Al Shaibani, the chief executive officer of Investment Corporation of Dubai, told Reuters in an interview on Monday.
"There is an opportunity and commercial banks know exactly what to go for," added Shaibani, who also head the Dubai ruler's court.
DDF had said in April it mandated banks for a $1.1 billion financing facility to help fund an expansion at Dubai's international airport. The facility includes Islamic and conventional tranches.
Citibank along with Dubai Islamic, HSBC and Emirates NBD have been hired to arrange and coordinate the debut international transaction.
Abu Dhabi Commercial Bank has committed to contribute to the loan but will not be involved in arranging it.
Dubai, which has clawed back from the depths of a crippling 2009 debt crisis, has been examining ways of raising finances to expand its existing aviation infrastructure after deciding to go slow on a $34 billion new Al Maktoum Airport facility designed to become the biggest in the world.
The government raised a $1.25 billion earlier this month through an Islamic bond.
Shaibani also said that DIFC Investments and Jebel Ali Free Zone, which have $3.25 billion of debt maturing before the end of this year, may sell some of their "strategic assets" to other state-owned entities instead to other investors.
"Most of these entities are asset-rich but we are also very cautious not to divest some of these assets below value. If they need to, most likely, we will use or have some other government entities who are liquid or cash-rich to be able to acquire some of these assets instead of selling them cheap to somebody else," he added.-Reuters