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20 January 2020

Dubai’s Emirates NBD seeks to take over Al Jaber’s DIFC plot

Emirates NBD is among creditors seeking to take action against Al Jaber and recover funds after two rounds of debt restructuring.

Family-owned Al Jaber Group is one of several businesses in the UAE that were affected by the 2008 financial crisis/Bloomberg

by Bloomberg

Emirates NBD, Dubai’s biggest bank is considering seizing a plot of land in the Dubai International Financial Centre that belongs to debt-laden Al Jaber Group.

The bank is considering taking over or selling the undeveloped land in the financial hub after becoming unsatisfied with little progress in assets sales under Al Jaber’s debt restructuring.

The land—worth about $70 million—was used as collateral to secure a loan for Chairman Obaid Khaleefa Al Jaber Al-Marri. Al Rihab Real Estate Company, a unit of Al Jaber, defaulted on a mortgage-related to the land.

Al Jaber last year agreed to raise about $445 million from asset sales by the end of 2019 while members of the Al Jaber family and other shareholders pledged to raise as much as $210 million by selling personal assets.

Family-owned Al Jaber, which borrowed heavily to expand in construction, engineering and shipping, is one of several businesses in the UAE that ran into trouble after the 2008 financial crisis. The company signed a pact to alter the terms on around $4 billion of debt in 2014 and agreed to restructure up to $1.5 billion last year.

Creditors—which include hedge funds and local banks—are now focusing on a AED 4.5 billion ($1.2 billion) loan the Chairman of Al Jaber Group got as part of the first restructuring. The facility was a related-party transaction and bears a personal liability to the shareholder.

Local banks such as Abu Dhabi Commercial Bank and First Abu Dhabi Bank are said to have already forced the sale of the Shangri-La hotel in Dubai and are seeking to do the same for the Shangri-La hotel in Abu Dhabi.

RELATED STORIES: Emirates NBD Shangri-La hotel Al Jaber Group Abu Dhabi Commercial Bank First Abu Dhabi Bank Dubai International Financial Centre





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