Dissin’ Dubai
Creditors to refuse Dubai World deal
Creditors of Dubai World are expected to reject a standstill agreement proposed by the company, threatening to drag out negotiations over $26bn (£15bn) worth of the conglomerate’s debt.
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By rejecting the company’s proposal to put interest payments on hold, creditors automatically trigger a default, leading to inevitable further wrangling.
Global markets have begun to recover following initial fears that the Dubai crisis would spread but the local battle over who bears the losses has only just begun. If the standstill is rejected and a default is triggered, all parties would have to compromise to reach a restructuring agreement, sources said.
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