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DUBAI — Dubai Group, part of an investment company controlled by the emirate's ruler, said Tuesday it has begun talking with two sets of lenders separately in an effort to hammer out a $6 billion debt restructuring more efficiently.
One negotiating committee is composed of secured creditors, which means their loans are backed by collateral, while the other is made up of partially secured and unsecured lenders, a spokeswoman told The Associated Press.
The committees were established in recent days and are in discussions with Dubai Group, she said. Splitting the lenders into two blocs representing similar interests is meant to streamline the negotiations.
"You basically make the process more efficient. We obviously want the quickest conclusion possible," the spokeswoman said, speaking on condition of anonymity in line with company policy.
The firm first acknowledged it was in debt talks with lenders in November, but gave no details, including the size of its liabilities.
Dubai Group has a $1.5 billion Islamic loan coming due this year. A total of 24 banks from the Middle East, Europe and Asia were involved in that loan when it was launched in 2008, including local lender Noor Islamic Bank and the U.K.'s Royal Bank of Scotland Group PLC.
Both banks are part of the six-member coordinating committee representing partially secured and unsecured lenders that was first made public by Bloomberg News. The Dubai Group spokeswoman confirmed the accuracy of the list, which also includes the UAE's Emirates NBD, Union National Bank, and al-Hilal Bank, as well as the Commercial Bank of Qatar. Nexgen, a division of France's Natixis SA, and Dubai-based Mashreqbank represent the secured creditors.
Dubai has had some success using bank coordinating committees, which are meant to represent the interests of all lenders, in winning better repayment terms for state-linked debt. A committee of seven core banks negotiated the broad terms of Dubai World's $24.9 billion restructuring, which eventually won support from the state conglomerate's more than 70 creditors in October.
Dubai Group is part of a conglomerate known as Dubai Holding, which is personally controlled by the city-state's hereditary ruler, Sheik Mohammed bin Rashid Al Maktoum. Another division of that firm, Dubai Holding Commercial Operations Group, late last month refinanced a $555 million credit arrangement with three international banks into a five-year loan after months of negotiations.
Dubai Group owns property in the U.S. and has sizable stakes in several financial companies, including regional bank EFG-Hermes and Europe's Marfin Popular Bank.
