The euro-zone crisis is hampering attempts by Dubai Group to sell assets as the troubled investment company grapples with US$10 billion (Dh36.73bn) of debt.
The company, part of Dubai Holding, is having difficulty proceeding with disposals intended to pay down its debts because of a general rush in Europe.
Road to ruin or recovery?
Euro Zone The National charts Europe's struggles as it attempts to through of financial crisis. Learn more
The euro zone's financial crisis has left European banks rushing to sell assets as they try to reduce exposure to risky government debt, which the IMF estimates at €200 billion (Dh1.01 trillion).
Dubai Group stopped payments to creditors in August last year to buy time to dispose of assets, a company spokeswoman said.
"We are in constructive ongoing discussions between the coordinating committee in order to restructure fully the bank debts," the spokeswoman said. "The purpose is to put the company on a sound financial footing going forward, allowing it to maximise the value of its assets for the benefit of all stakeholders."
Through various arms of its business, Dubai Group owns stakes in a number of financial services companies, including Borse Dubai and EFG-Hermes, as well as shopping centres, hotels and offices in the US, Europe and Asia.
Banks had granted breathing room for Dubai Group and had agreed to extend credit facilities until the euro-zone crisis eased and asset values recovered, a source close to the talks said.
"Lenders recognise the importance of preserving cash in the company and have shown support by informally rolling facilities throughout the discussions," the source said.
Dubai Holding is the third of the emirate's investment companies, alongside Investment Corporation of Dubai and Dubai World, the conglomerate that finalised a restructuring agreement on $24.9bn of liabilities this year.
The paralysis at Dubai Group, alongside debt restructuring at Dubai Holding, is expected to increase problem loans to 13 to 15 per cent of banks' total loan books this year, analysts from Moody's Investors Service wrote in a research report.
"Dubai Holding will be a significant driver of problem loans in 2011," the report said. "Negotiations are in their early stages, but the potential of some Dubai Holding-related impairment charges over the outlook horizon is high given its highly varied and illiquid asset mix," the report said.
The report also reiterated its "negative" outlook on the UAE's banking sector, saying Dubai's banks were significantly underperforming Abu Dhabi's because of problems at Dubai's government investment companies.
Dubai Group began talks with lenders a year ago to delay its debt repayments.
The extent of debts at Dubai Group was revealed in April when the company publicly disclosed that its liabilities had risen from $6bn to $10bn.
The negotiations have been particularly complex because of the need to reconcile the interests of two groups of creditors - those whose debts are secured with collateral and others with unsecured or partially secured debts.
Emirates NBD, the UAE's biggest bank, made provisions of Dh950 million against its Dh4.8bn exposure to Dubai Group during the third quarter, pushing its quarterly profit to its lowest since the beginning of the financial crisis.
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A MINECRAFT MOVIE
Director: Jared Hess
Starring: Jack Black, Jennifer Coolidge, Jason Momoa
Rating: 3/5
The more serious side of specialty coffee
While the taste of beans and freshness of roast is paramount to the specialty coffee scene, so is sustainability and workers’ rights.
The bulk of genuine specialty coffee companies aim to improve on these elements in every stage of production via direct relationships with farmers. For instance, Mokha 1450 on Al Wasl Road strives to work predominantly with women-owned and -operated coffee organisations, including female farmers in the Sabree mountains of Yemen.
Because, as the boutique’s owner, Garfield Kerr, points out: “women represent over 90 per cent of the coffee value chain, but are woefully underrepresented in less than 10 per cent of ownership and management throughout the global coffee industry.”
One of the UAE’s largest suppliers of green (meaning not-yet-roasted) beans, Raw Coffee, is a founding member of the Partnership of Gender Equity, which aims to empower female coffee farmers and harvesters.
Also, globally, many companies have found the perfect way to recycle old coffee grounds: they create the perfect fertile soil in which to grow mushrooms.
COMPANY PROFILE
Initial investment: Undisclosed
Investment stage: Series A
Investors: Core42
Current number of staff: 47
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Tuesday's fixtures
Kyrgyzstan v Qatar, 5.45pm
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
FIGHT CARD
Welterweight Mostafa Radi (PAL) v Tohir Zhuraev (TJK)
Catchweight 75kg Leandro Martins (BRA) v Anas Siraj Mounir (MAR)
Flyweight Corinne Laframboise (CAN) v Manon Fiorot (FRA)
Featherweight Ahmed Al Darmaki (UAE) v Bogdan Kirilenko (UZB)
Lightweight Izzedine Al Derabani (JOR) v Atabek Abdimitalipov (KYG)
Featherweight Yousef Al Housani (UAE) v Mohamed Arsharq Ali (SLA)
Catchweight 69kg Jung Han-gook (KOR) v Elias Boudegzdame (ALG)
Catchweight 71kg Usman Nurmagomedov (RUS) v Jerry Kvarnstrom (FIN)
Featherweight title Lee Do-gyeom (KOR) v Alexandru Chitoran (ROU)
Lightweight title Bruno Machado (BRA) v Mike Santiago (USA)
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
How to help
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'Morbius'
Director: Daniel Espinosa
Stars: Jared Leto, Matt Smith, Adria Arjona
Rating: 2/5
How much sugar is in chocolate Easter eggs?
- The 169g Crunchie egg has 15.9g of sugar per 25g serving, working out at around 107g of sugar per egg
- The 190g Maltesers Teasers egg contains 58g of sugar per 100g for the egg and 19.6g of sugar in each of the two Teasers bars that come with it
- The 188g Smarties egg has 113g of sugar per egg and 22.8g in the tube of Smarties it contains
- The Milky Bar white chocolate Egg Hunt Pack contains eight eggs at 7.7g of sugar per egg
- The Cadbury Creme Egg contains 26g of sugar per 40g egg
The White Lotus: Season three
Creator: Mike White
Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell
Rating: 4.5/5
COMPANY PROFILE
Name: Kumulus Water
Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
Number of staff: 22
Investment raised: $4 million
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
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COMPANY%20PROFILE
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