UAE’s Dana Gas agrees with creditors on $700 mln sukuk restructuring

Updated 13 May 2018
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UAE’s Dana Gas agrees with creditors on $700 mln sukuk restructuring

DUBAI: Energy producer Dana Gas reached agreement with creditors on restructuring $700 million of sukuk, the firm said on Sunday, potentially ending a protracted legal battle that unsettled the global Islamic finance industry.
The United Arab Emirates firm said in June it would not redeem the Islamic bonds, arguing that changes in Islamic financial practice since they were issued made them invalid under UAE law. This led to months of negotiations and a fight in UAE and British courts.
Under the deal with the sukuk holders’ committee, investors who want to exit the instruments will be able to do so at 90.5 cents on the dollar, which includes a bonus of 2.5 cents if they accept within seven days of the start of the tender offer.
Alternatively, investors will be able to exchange the sukuk into new three-year Islamic instruments with a 4 percent profit rate, while receiving final profit payments that they were owed before the old sukuk matured last Oct. 31.
“The consensual transaction represents a means to resolve amicably all current issues and disputes facing the parties,” Dana said in a statement.
The company said it expected to launch the tender offer this month and complete the deal by the first half of July — though this depended on conditions including payment of costs of certain parties, termination of all current litigation, and the release of certain claims being met.
Holders representing over 52 percent of $350 million of sukuk that were convertible into equity, and over 30 percent of $350 million of non-convertible sukuk, agreed to take no further action before the tender offer, Dana said.
Its shares jumped 4.8 percent in early trade on Sunday in response to news of the deal, which it said could cut its debt by up to $385 million.


Oman advises Dhofar businesses to close after Cyclone Mekunu hits

Updated 27 May 2018
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Oman advises Dhofar businesses to close after Cyclone Mekunu hits

DUBAI: Oman has advised all private sector establishments in Dhofar region to shut down for three days after Cyclone Mekunu hit the southern part of the Gulf Arab country.
The labor ministry declared a three-day holiday for companies and establishments in the private sector, state news agency ONA reported on Sunday.
The central bank issued a circular announcing a three-day holiday starting on Sunday for money exchange houses, banks, finance and leasing companies in Dhofar.
Cyclone Mekunu hit southern Yemen and the coast of neighboring Oman over the weekend, resulting in several fatalities.
Sembcorp Salalah Water and Power Co, which operates an electricity generation and seawater desalination plant in Oman, said its water production plant had been shut down temporarily because of rough seas because of a tropical storm.