Dubai jeweler gets lifeline
By Tarek El-Tablawy |
March 29, 2010, Monday
|
Print Edition
Print Edition
DEBT-SADDLED Middle East jewelry retailer Damas International said yesterday it had reached a "standstill" agreement with most of its creditors and was moving ahead with a restructuring plan.
The Dubai-based company did not specify the amount of debt it wanted to delay payments on, but local daily, The National, has put it at about US$872 million.
"This is a significant, positive announcement, demonstrating the confidence of our bank lenders in the strength of the underlying business model of Damas, the leading retail jewelry company in the Middle East," the jeweler said in an e-mailed statement.
"A restructuring plan is currently being developed by the company, which will be implemented at the end of the standstill period," the firm said without providing other details about the deal or giving an indication about the duration of the standstill.
The move offers some good news for the family-run firm which last week was fined by a Dubai watchdog for improper financial deals and lax corporate oversight.
The penalties levied against the company were the most severe to date and came amid Dubai's efforts to shore up its business and investor-friendly image in the region after the global meltdown dried up credit markets and left companies struggling to repay their debts.
In a filing posted yesterday on the Nasdaq Dubai Website, Damas said an extraordinary general meeting for shareholders would be held on April 19 to elect new board members.
The Dubai-based company did not specify the amount of debt it wanted to delay payments on, but local daily, The National, has put it at about US$872 million.
"This is a significant, positive announcement, demonstrating the confidence of our bank lenders in the strength of the underlying business model of Damas, the leading retail jewelry company in the Middle East," the jeweler said in an e-mailed statement.
"A restructuring plan is currently being developed by the company, which will be implemented at the end of the standstill period," the firm said without providing other details about the deal or giving an indication about the duration of the standstill.
The move offers some good news for the family-run firm which last week was fined by a Dubai watchdog for improper financial deals and lax corporate oversight.
The penalties levied against the company were the most severe to date and came amid Dubai's efforts to shore up its business and investor-friendly image in the region after the global meltdown dried up credit markets and left companies struggling to repay their debts.
In a filing posted yesterday on the Nasdaq Dubai Website, Damas said an extraordinary general meeting for shareholders would be held on April 19 to elect new board members.
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