Dubai Forums Dubai Discussions Dubai General Chat

By Arif Sharif and Haris Anwar

April 5 (Bloomberg) -- The Dubai Electricity & Water Authority, the state-owned utility, and the Dubai Civil Aviation Authority raised $2.84 billion in syndicated loans to repay their debt, making April a busy month for Gulf Arab debt issues.

Dewa received a $2.2 billion loan from 18 international and local banks to refinance maturing debt, it said in an e-mailed statement today. The details of the facility will be announced on April 8. Dubai Civil Aviation raised $635 million in an Islamic Ijara loan to repay $1 billion of its debt, the Dubai government said in a separate statement.

Abu Dhabi, the oil-rich emirate with the world’s biggest sovereign wealth fund, raised $3 billion on April 1 in its first sale of bonds in two years. Qatar, the world’s largest exporter of liquefied natural-gas, sold $3 billion of bonds on April 2 to fund companies hurt by the global credit crisis. These came after Borse Dubai Ltd. borrowed $2.5 billion in February to refinance a facility it used to buy stakes in Swedish exchange operator OMX AB and the London Stock Exchange.

Dubai and its state-owned companies borrowed $80 billion to finance its transformation into a regional financial and tourist hub and the collapse of global credit markets last year sparked fears the emirate would default on loan obligations. Dubai government companies need to repay $10 billion of bonds and syndicated loans in the remainder of the year, $7 billion in 2010 and $25 billion in 2011, S&P analyst Farouk Soussa said last month. This doesn’t include money owed by banks.

Multi-Currency Loan

Dubai Civil Aviation’s loan includes a 1.7 billion tranche in dirhams, 100 million in dollars and 52 million in euros. The facility will pay a profit rate of 300 basis points over benchmark interest rates. The Dubai government will contribute $365 million to bridge the shortfall.

Dubai Islamic Bank PJSC, the United Arab Emirates’ biggest bank complying with Muslim banking rules, coordinated the Dubai Civil Aviation loan. DIB, Emirates NBD PJSC, Noor Islamic Bank PJSC and Industrial & Commercial Bank of China and West LB acted as mandated lead arrangers and bookrunners for the transaction. Mashreqbank PSC, Union National Bank PJSC and Commercial Bank of Dubai PSC were other participating banks.

Dewa will get $2.2 billion in a multicurrency loan at an annual interest rate of 300 basis points more than the interbank offered rates to refinance its debt, said two bankers April 1, who declined to be identified because the talks are private.

To contact the reporter on this story: Arif Sharif in Dubai at asharif2@bloomberg.netHaris Anwar in Dubai on Hanwar2@bloomberg.net

http://www.bloomberg.com/apps/news?pid= ... refer=home