Kuwait's Investment Dar strikes debt deal with creditors

Kuwait’s Investment Dar strikes debt deal with creditors

Asa Fitch

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Investment Dar, the Kuwaiti investment firm that owns half of the iconic British car maker Aston Martin, has reached an agreement with creditors to restructure its debt, the company said today.A creditors� coordinating committee reached a two-thirds concensus on the restructuring pact, allowing it to move forward.Investment Dar had presented its restructuring plans to banks and investors in Kuwait and Dubai last month, outlining a plan to satisfy creditors and investors by spreading out debt payments over a five-year period. In addition to paying back the money it owes over that time frame, the company said it would provide creditors with an �enforceable security package� and continue to employ a chief restructuring officer.

The company did not release full details about amounts owed and interest rates to be paid under the five-year restructuring plan, but according to Bloomberg, the firm owed banks and investors about US$3.73 billion (Dh13.6bn) as of September of last year.Investment Dar was one of the first large firms in the Gulf to face serious turmoil during the financial crisis. It defaulted in May on a $100 million Islamic bond, or sukuk, giving it the dubious distinction of being the first firm in the region to default on a sukuk.

It embarked on restructuring talks soon after the default, appointing a coordinating committee and chief restructuring officer who hashed out the agreement reached today.While many firms in the region have begun restructurings, yesterday�s announcement makes Investment Dar the second major company in the Gulf to approve and formalise a restructuring plan. Global Investment House in Kuwait on December 10 reached a three-year restructuring agreement with its creditors after defaulting on numerous loans late last year. In the best-publicised restructuring in the region so far, Dubai World, a Government-owned conglomerate, began talks talks with creditors this week over $22bn in debt.

With the approval of creditors, the restructuring plan at Investment Dar will be put into place �as soon as possible�, according to a company statement.�We are delighted to have received majority support for the restructuring plan, and would like to thank all the banks and investors for their commitment throughout these difficult days,� said Adnan al Musallam, the chairman and managing director of Investment Dar. �Investment Dar is committed to completing the proposed restructuring plan as soon as possible.�

Bader Abdullah al Ali, a spokesman for the coordinating committee, said the creditors were looking forward to a �quick decision� on the implementation of the restructuring plan. He said the committee would continue talks with banks and investors who did not approve the plan in the two-thirds majority vote in an effort to convince them to accept its terms.�We will continue to communicate with the remaining minority of banks and investors who do not seem to support the plan so far to do so as soon as possible, so that they can accede to the final implementation phase of the restructuring plan,� he said.

afitch@thenational