Dubai’s Emaar Properties has agreed with banks to slash the interest rate on a $500 million syndicated loan, the developer said, in the latest example of a local company winning a cut in funding costs from cash-flush bank lenders.
Emaar, Dubai’s largest listed developer and a bellwether of the emirate’s main bourse, said in a statement to Reuters that as of Dec. 11, the pricing on the loan had fallen by 1.5 per cent, with banks agreeing to the London interbank offered rate plus 1.25 per cent.
Margins on the loan will range to 1.75 per cent based on loan drawdown proportions, it added.
The loan was signed in September 2013 with $450 million to mature in 2018 and $50 million to come due in 2020, according to Thomson Reuters data. Emaar did not reveal how many banks were in the syndicate or identify them by name, but said it mostly consisted of banks from the United Arab Emirates.
Emaar reported a 21 per cent rise in third-quarter net profit in October. Dubai’s government has a minority stake in Emaar.