Monarch Unlikely To Accept Dubai Debt Deal

Apr 4 2012 | 2:28am ET

Dubai's Drydocks World is moving forward with its debt restructuring plans in the face of determined opposition from one hedge fund creditor.

The subsidiary of Dubai World, which is owned by the emirate's government, has asked a special tribunal to approve its US$2.2 billion debt plan. Under a 2009 law designed to protect state-owned entities from creditors, the tribunal—made up of three judges from the U.K. and Singapore—can force a settlement if it has the backing of creditors holding 75% of the debt in question.

Drydocks World already has the support of 87% of creditors, a figure expected to rise to 94% within a week. But don't expect Monarch Alternative Capital to be among the assenters.

The U.S. hedge fund, which last month won a US$72 million verdict against Drydocks World in a British court, probably won't go along, one of Drydocks' three nominees to oversee its debt plan, said.

"I remain skeptical that Monarch will agree to the deal," PricewaterhouseCoopers' Ian Schneider said. Monarch has accused Drydocks of defaulting on a loan.

Still, Schneider said, the deal could be completed by early July. Under Drydocks' plan, the maturities on the loans would be extended by five years.


In Depth

Q&A: Filippo Pignatti Morano On The Ultimate Alternative Investment...Classic Cars

Jan 29 2015 | 12:37pm ET

In 2011, Filippo Pignatti Morano launched a fund to invest in classic cars. FINalternatives...

Lifestyle

Looking For A Hedge Fund Manager? Try Davos

Jan 28 2015 | 8:48am ET

Davos, Switzerland seems to have become the hedge fund capital of the world—at...

Guest Contributor

Five Tips For Successfully Marketing Your Hedge Fund

Jan 30 2015 | 9:14am ET

When it comes to the hedge fund industry, the notion of “build it and it will...

 

Editor's Note