Drydocks World LLC, the Dubai-based shipyard that’s restructuring $2.2 billion of debt, is working on an “exit strategy” for its Southeast Asian business.
“An exit strategy is in progress,” Chairman Khamis Buamim said, when asked about Drydocks World’s Southeast Asian operations, without providing details. The South East Asian business is “viable” and the company is “in active discussions on a joint venture deal,” Buamim has said April 2.
Drydocks World borrowed $2.2 billion to finance two acquisitions in Singapore in 2008 to gain ships and Asian shipbuilding sites. The company borrowed $1.7 billion for three years at 170 basis points, or 1.7 percentage points, over the London interbank offered rate, according to data compiled by Bloomberg. It borrowed another $500 million for five years at 190 basis points over Libor, the data shows.
Drydocks World’s Dubai unit, the Middle East’s largest shipyard, carries out vessel conversions, ship building and offshore construction, apart from ship repairs, mainly of ultra and very large crude carriers. The company has yards operating in Singapore and Indonesia, in Graha, Pertama and Nanindah.
New York-based Monarch Alternative Capital LP, a U.S.-based company that invests mainly in distressed debt, has not yet agreed to the company’s debt restructuring proposal, Buamim said. All creditors will be treated similarly, he said.
Drydocks World today signed an agreement with Swiss company BIG InvestConsult AG that has access to technology to build hotels that are partly underwater, the company said in a statement distributed at a news conference today. Drydocks World will be the main contractor for the floating hotels and cities to be built in the Middle East, it said.
InvestConsult plans to build two clusters of five hotels each and is selling the idea of building floating resorts across the world, Bogdan Gutkowski told reporters at the conference.
Each one of the hotels will cost between $50 million to $120 million to build, Buamim said.
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