Bloomberg News

Dubai’s Drydocks Faces Suit Amid $2.2 Billion Debt Restructuring

October 19, 2011

Oct. 19 (Bloomberg) -- Monarch Alternative Capital LP, a New York-based investment company, filed a claim of about $45.5 million in a London court against Drydocks World LLC as the Dubai World unit works on restructuring $2.2 billion of debt.

The case was filed on Oct. 6 by Monarch Master Funding Ltd. in the High Court of Justice, according to the case filing. Jeremy Fielding, a spokesman for Monarch, which mainly invests in distressed debt, confirmed the filing and the amount.

“It is regrettable that this one lender alone has decided for unclear reasons to take legal action,” Drydocks said in an e-mailed response to questions from Bloomberg News. “The company is currently considering its formal response.”

Drydocks World, a ship-repair unit, is negotiating with creditors on delaying debt repayments. Dubai’s government may not support Drydocks with its debt restructuring as that responsibility falls on its parent Dubai World, Mohammed Al Shaibani, the director general of Dubai ruler’s court, a top government official, said Sept. 23.

Dubai in March 2010 provided $1.5 billion in cash to Dubai World and converted $8.9 billion of loans to equity of the company as part of the $25 billion debt restructuring.

Drydocks World “is working diligently with its core coordinating committee and all other lenders to finalize a consensual financial restructuring in the shortest possible time,” the company said in the statement.

--Editors: Claudia Maedler, Tim Farrand

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

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net


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