Dubai`s finance chief blamed the media for spreading "blind panic"

original source maktoob

DUBAI - Dubai's finance chief blamed the media on Thursday for spreading "blind panic" about the emirate's financial problems as it struggles to deal with more than $80 billion of government and corporate debt.

In a speech to the Dubai School of Government, Abdulrahman Al Saleh, director of Dubai's Department of Finance, said the emirate's debt problems were a "hiccup-damaging for Dubai's credibility and lacking broader significance of exaggerated media campaigns."

Al Saleh accused the international press of creating "blind panic" about Dubai's economic troubles after it asked bankers to freeze $26 billion worth of debt owed by one of its largest government owned companies, Dubai World.

Dubai's benchmark stock index has fallen about 30% since the government shocked investors by seeking a standstill on Dubai World's debt late last month.

Read also: They still dont get it ....guardian uk

Dubai Schulden Albtraum-Szenario - Dubai World - Nakheel - Dewa

original source Handelsblatt Germany

"Viele Kreditverträge haben eine Klausel über reziproken Verzug: Wenn ein Gläubiger in einem Fall zahlungsunfähig wird, kann er bei all seinen anderen Kredit-Verpflichtungen ebenfalls in die Zahlungsunfähigkeit abrutschen", sagte Jawad Ali von der Anwaltskanzlei King & Spalding. Im Klartext: Sollte Nakheel seine Außenstände nicht begleichen, muss die Mutter Dubai World einkalkulieren, dass alle Gläubiger plötzlich ihre Ansprüche geltend machen.

Die Details hingen von der Formulierung des jeweiligen Vertrags ab. "Das ist ein Albtraum-Szenario, das Dubai World mit dem Schulden-Moratorium verhindern möchte", so Ali.

read the full article Auf Dubai rollt nächste Schuldenlawine zu (bei Handelsblatt.com am 10.12.2009 veröffentlicht)

Dubai Holding seen at risk

original source Zawya / Financial TimesThursday, Dec 03, 2009
Thursday, Dec 03, 2009

Thursday, Dec 03, 2009

With Dubai World cut adrift from implicit government support, there are concerns about potential defaults by other state-related entities. The name mentioned most by bankers and investors in the region is that of Dubai Holding, the personal investment vehicle of the ruler, Sheikh Mohammed bin Rashid al-Maktoum.

"Dubai's actions have introduced the risk that restructuring of other corporates could follow," Barclays Capital said in a report this week. "We would focus on those with weak fundamentals and upcoming maturities and we view Dubai Holding as being most at risk."

Dubai Holding's Commercial Operations Group's debt was yesterday downgraded to below investment grade by Standard & Poor's, the ratings agency, along with four other government related companies. The cost of insuring $10m (€6.7m, £6m) for five years against default ballooned to $1.1435m a year on Tuesday, making it the riskiest Dubai corporate bond according to the market.

A Dubai Holding spokesman yesterday said: "I am very doubtful that we will face any problems paying the debt. Dubai Holding is confident that it is on track with all payments."

Formed in 2004, its investment arms led the emirate's international buying spree to recycle funds generated by developing swaths of Dubai desert. The group leveraged profits to build debts of $10bn, with maturities in 2010 of $2bn, according to Barclays Capital.

Bankers say because of its connection to the ruler the conglomerate enjoys stronger political standing than Dubai World

It appears to have a stronger financial position. Analysts say it has a greater ability to service its debts thanks to a number of cash-generating businesses. It is believed to have received cash injections from the government in recent months. The company has never confirmed this.

Still, bankers say its investment arms, Dubai International Capital and Dubai Group could face more financial problems than its commercial wing, which spans hospitality, business parks and real estate. "Dubai Holding is not going to acknowledge problems right now. But there is a contagion effect in every Dubai entity , this is just the beginning," a senior banker said.

Dubai International Capital is believed to be looking to sell assets but has enough money ringfenced by the holding company to keep afloat its buy-out businesses in Europe and the Middle East, according to those familiar with the company. These people say its public equities portfolio, which includes stakes in EADS, Sony and ICICI Bank in India, may be sold. DIC is also winding down its emerging markets private equity unit, Middle East venture capital portfolio and interests in other private equity funds.

Dubai HoldingDubai 's commercial arm includes profitable businesses, such as flagship hotels company Jumeirah Group. The group has slimmed down faster than the troubled Dubai World conglomerate. DICand Dubai Group, for example, have merged their back-office operations and Dubai Holdings' developers have merged and been folded into Dubai 's leading developer, Emaar Properties, much to the alarm of minority shareholders who fear dilution and say they are being forced to bail out other companies.

The restructuring already under way at Dubai Holding is so deep that analysts are raising the possibility that, like Dubai World
, it could be broken up and its best businesses - notably Jumeirah - moved into other parts of Dubai Inc., such as Investment Corporation of Dubai , which is emerging as the emirate's "good bank" of assets.