Dubai Developer Nakheel Pays Off Dh2.5b Of Debt

Nakheel has paid $681 million (Dh2.5 billion) of the $1.1 billion (Dh4 billion) it owes to trade creditors under its debt restructuring proposal, a spokesperson confirmed to Gulf News. A report in the Al Khaleej newspaper said that about 80 per cent of Nakheel's trade creditors have agreed to new payment terms. Nakheel said on June 30 it had begun settling bills from its biggest trade creditors, involving a payout of Dh4 billion. The payment would help a number of contractors to move ahead with projects while suppliers and subcontractors will breath a sigh of relief. Although this will have a trickling effect on the sub-contractors and building materials suppliers, the fact that the money is coming in the market, is a good thing and will definitely help the small suppliers and sub-contractors. Something is definitely better than nothing," a construction industry official said, requesting anonymity. Nakheel is now waiting for a final response from bank creditors on restructuring its obligations. Nakheel said on July 14 a group of its creditors "unanimously supported" a proposal on altering the terms on $10.5 billion of loans and unpaid bills.