Drake & Scull expects to restructure Dh1 billion of Saudi debts by March

Drake & Scull International expects to finalise restructuring of approximately Dh1 billion of debt it raised for projects in Saudi Arabia by March-end this year. It will begin negotiations with bondholders in the UAE to refinance Dh440 million worth sukuk in the second half of 2018, the company said yesterday.

The Dubai contractor, which was hit hard by a slowdown in the Arabian Gulf economies, has already reached an agreement with a group of nine lenders to refinance Dh566m of corporate debt. Under the deal agreed in the fourth quarter of 2017, the banks on average have extended the maturities by three years on loans, representing 56 per cent of the company’s total corporate general debt, which at the end of September last year stood at Dh1.07bn, DSI said in a statement on the Dubai stock exchange, where its shares are traded.

The company has secured new credit lines and working capital facilities for its ongoing and new projects portfolio. The Dh440m sukuk, due to mature in November 2019, makes up the remaining tranche of the DSI’s corporate general debt, it said. The DSI group’s total bank debt at the end of the third quarter of 2017 had reached Dh2.92bn.

DSI’s shares surged 6.5 per cent in early trading before losing momentum, ending the day down 0.4 per cent at Dh2.29.