The developer said it has cleared its obligations to 92 per cent of trade creditors.
Indebted Dubai property firm Limitless has concluded the restructuring of a $1.2 billion loan, bringing to an end talks that have lasted over two years.
The former property arm of Dubai World, which once tried to build a 75-kilometre inland waterway called the Arabian Canal, will now be owned by the Dubai government, Limitless said on Thursday.
“Limitless has honoured all profit payments on the loan since it was signed in 2008, and will continue to make the payments under the new agreement,” the developer said.
The developer said it has cleared its obligations to 92 per cent of trade creditors, and has signed settlement agreements with the remainder. It did not give details of terms agreed with creditors for the restructuring, including the time period by which the loan was extended.
Hit hard by the global financial crisis, Limitless rolled over the Islamic debt facility owed to a syndicate of banks several times. The loan was originally due to mature in March 2010.
The developer was a victim of Dubai’s corporate debt crisis in 2009 triggered by conglomerate Dubai World’s request to delay repaying $26 billion in debt. Dubai World reached an agreement in 2011 with banks to extend debt maturities and promising repayment mostly through asset sales.
Dubai World transferred ownership of Limitless to the government along with Nakheel, which also restructured its $16 billion debt last year.
Helped by an economic revival in trade and tourism over the past year, Dubai has pushed for solutions to debt problems. State-linked Dubai International Capital reached an agreement with banks earlier this year to reschedule $2.4 billion of debt, and Dubai Holding Commercial Operations Group agreed on a $555 million rescheduling last December.
Limitless’s current projects are the Downtown Jebel Ali master development and The Galleries mixed-use community within phase one of Downtown Jebel Ali.
Overseas, the company is currently developing Al Wasl in Saudi Arabia, Zagorodny Kvartal in Russia and Halong Star in Vietnam.