Halcrow to agree Nakheel repayment terms in weeks

Halcrow is owed money for work it did on a district cooling plant on Palm Jumeirah.

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British Engineering company Halcrow is reportedly on the brink of accepting Nakheel’s offer to repay 40% of its debts in cash and 60% in Sukuk, The National newspaper has reported.

Owed money for a number of medium-sized projects, including a district cooling plant on Palm Jumeirah, the contractor is apparently very close to finalising certain details of a repayment plan. Earlier this week, the firm’s managing director for the Middle East David Yaw made clear he is hoping to reach an agreement with Nakheel in the next “few weeks, or a month at the most”.

The announcement follows months of speculation over how Nakheel will pay its trade creditors for work already completed, the latest offer only possible if as many as 65% accept the developer’s proposals.

To date, Nakheel has agreed terms with 50% of its trade creditors.

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“There are still a couple of finer details to sort out,” Mr Yaw, told the newspaper. “Nakheel has a specialised team of people working on this… we hope to have it finalised in a few weeks or a month at the most.”

In March, he told reporters at the National that Nakheel’s offer of repayment was a step in the right direction, and that his firm welcomed any move which would help to restore confidence in the Dubai construction marketplace.

He also commented that his company’s exposure to the Nakheel debt crisis was “enough to hurt but modest” compared to the firm’s “overall exposure in the region”.

Last year, Halcrow reported a 57% fall in profits due to late payments from developers, and was forced to axe as many as 60 jobs across its Middle East division.