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Abu Dhabi to finance Dubai World debts

US $4.1 billion will be used to pay sukuk that is due today

Fresh funds may put a dent in Dubai World's debts.
Fresh funds may put a dent in Dubai World's debts.

Dubai's government today said it has received US $10 billion (AED36.7 billion) in financing from Abu Dhabi, some of which will be used to pay off Dubai World’s and its property unit Nakheel’s debt, according to Dow Jones.

"As a first action for the new fund, the Government of Dubai has authorized $4.1 billion to be used to pay the sukuk obligations that are due today," the Dubai government said in an emailed statement.

The remainder of the funds will be used "for the satisfaction of obligations to existing trade creditors and contractors", it said. Discussions with affected contractors are expected to begin shortly.

Dubai government also said it will introduce a reorganisation law to ensure greater transparency and creditor protection. The law will be available if Dubai World and its subsidiaries are unable to achieve an acceptable restructuring of its remaining obligations, it said.

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Construction Week - Issue 741
May 11, 2019