Investment Dar, the Kuwaiti firm whose assets include a stake in luxury carmaker Aston Martin, said on Saturday a local court had ruled to lift protection the company had against legal action by creditors.
Investment Dar was one of several local financial firms which struggled to refinance debt in the aftermath of the global economic crisis but was the first to reorganise under Kuwait’s Financial Stability Law – introduced in 2009 to assist debt renegotiations in a country with opaque bankruptcy rules.
As part of that legislation, Investment Dar secured a halt to all legal cases being brought against the firm in relation to non-payment of debts to allow it to implement its restructuring.
However, a company statement said a July 24 court ruling had stated that legal protection from creditors would be lifted in accordance with the financial stability law.
“This decision is disappointing for us and for many investors, but we respect it and respect the opinion of the Kuwaiti judiciary,” the firm’s statement said.
It added Investment Dar remains committed to repaying all three groups of creditors under its restructuring plan the total amount of KD440 million ($1.56 billion). It didn’t specify if this was the outstanding amount left to repay to creditors.
Since agreeing a restructuring plan in 2011 which covered debts worth KD1 billion, Investment Dar has twice attempted to make new offers to creditors to exchange their debt for alternative instruments.
In May, the company proposed a voluntary settlement-in-kind offer to outstanding creditors, with one of the reasons cited for the proposal a failure to yet secure ownership of a major asset through a court process, which it had hoped to sell to fund repayments to creditors.
Investment Dar has been embroiled in a long-running legal battle with Commercial Bank of Kuwait over a stake in Kuwaiti Islamic lender Boubyan Bank.
This follows a separate settlement-in-kind offer agreed in December with around a third of the original creditors, which offered them shares in a portfolio of its assets in exchange for their debt claims.