Dana Gas, the region's only publicly listed gas producer, has hired the world's largest private equity firm to help it restructure debt that is nearing maturity.
The Blackstone Group has been brought in to advise on a substantial debt in the form of a US$1 billion (Dh3.67bn) sukuk that matures in October, people with knowledge of the matter have told The National, although Dana declined to comment.
The sukuk has been a burden on the company's stock market performance for some time.
In January, the gas producer reported positive full-year results for last year, with net profit up more than threefold to Dh506 million and revenue up by 43 per cent to Dh2.53bn.
But the company remained silent on its debt, in spite of much speculation and the expectation that it would address the issue.
"We see positive numbers and good news on the collection front, but all eyes will remain on the anticipated announcement of the company's sukuk," Abid Riaz, an analyst at EFG-Hermes in Dubai, said in January.
Because of concerns over the debt, Dana stock rose by only 2.7 per cent on the day of the announcement.
The company's shares dropped by 42 per cent over the course of last year.
Dana shares rallied prior to the release of the full-year earnings after the company said on January 17 that it would meet its obligations and appointed a financial adviser.
Yesterday, Dana shares closed unchanged at 47 fils on the Abu Dhabi Securities Exchange General Index.
Analysts expressed confusion about the Blackstone move and said they were seeking more information from the company before they could say what impact it might have on shareholders.
According to news reports, the company has already hired Deutsche Bank to look at restructuring its debt.
Dana Gas shares have declined to a tenth of what their value was in 2005, when the company, which is a subsidiary of Sharjah-based Crescent Petroleum, launched its initial public offering.
Dana had hoped to be able to draw on a gasfield in Iran and has built a pipeline to Sharjah to supply the gas-poor UAE.
But a deal with National Iranian Oil Company, signed in 2001, never took effect, and the company's market value plunged.
The company's fortunes improved with significant gas finds in Egypt and in the semi-autonomous region of Kurdistan in Iraq, where Dana operates in joint venture with Austria's OMV, Hungary's MOL and Crescent.
Dana's production averaged 66,200 barrels per day from Egypt and Kurdistan last year, an increase of 19 per cent from 2010.
Blackstone, based in the United States, had total assets of $190bn under management at the end of last year.
Shareholders in Abu Dhabi Commercial Bank (ADCB) have voted down a proposal to increase directors' pay.