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Date: 16/12/2008

Dubai World repays loan obtained from banks globally

Dubai World recently repaid $890 million (Dh3.269 billion) outstanding balance on a $1.2 billion loan it obtained from banks globally last year to acquire a 9.4 per cent stake in MGM Mirage by Infinity World, a subsidiary of Dubai World. The loan repayment by Dubai World is the third in a series by Dubai Government owned entities in the last few weeks.

"While refinancing had been offered, Dubai World determined the cost of capital was not competitive and instead elected to repay the outstanding amount under the loan of $890 million from its operating reserves on December 11, 2008," Dubai World said.

Investment bankers and analysts said yesterday that the debt repayments on or ahead of their repayment schedules by these government owned entities point to their financial strength and should put to rest the speculation about Dubai's ability to meet its debt obligations.