Tabreed will issue 1.7 billion dirhams ($463 million) of subordinated mandatory convertible notes to Mubadala to refinance Tabreed's existing bridge loan with the fund of the same amount. These are priced at 1.13 dirhams and mature in 2019

Tabreed will also get a 1.4 billion dirhams loan facility from the investment fund that matures on December 2012.

Tabreed's shares fell 8.1 percent at 0900 GMT on the announcement on Wednesday. Tabreed, also known as the National Cooling Co., one of a number of Gulf companies restructuring debts after the end of the region's economic boom.

Chief Financial Officer Stephen Ridlington said in a conference call that it was not clear how much of new loan Tabreed would use.

"Ultimate amount of funding we will require is uncertain," said Ridlington, who said the company had more than sufficient funds to meet requirements until the end of 2012.

Mubadala, wholly-owned by the oil-rich Abu Dhabi government, has stakes in Advanced Micro Devices Inc. and Ferrari, as well as General Electric and private equity firm Carlyle. It bailed out Abu Dhabi developer Aldar Properties in January with a $5.2 billion support.

Tabreed last month reached a deal with banks to refinance 2.63 billion dirhams in debt.

"It's an 8-year facility, in tranches, but a single facility with an LIBOR margin of around 2 percent," said Ridlington.

The company expects to close the recapitalization program by March 31.

"The management's focus will be on completing Tabreed's build-out program, developing the company's core chilled water business, and increasing profitability," said Khaled Al-Qubaisi, Tabreed's managing director.

Al-Qubaisi said later at a conference in Abu Dhabi that the firm had no need to sell any of its assets.

Dubai-listed Tabreed has a 1.7 billion dirhams convertible Islamic bond due in May. The firm has asked holders of the bond to tender certificates for repurchase.

The Islamic bond is mandatorily convertible into shares and will be repaid through issuing shares.

Tabreed is also asking shareholders to accept shares instead of cash for a pending coupon payment of 246.5 million dirhams.

The company said it had no plans to tap the capital markets soon.

Ridlington said Tabreed was very focused on cost management but has no plans for staff cuts or management changes.