Trade creditors of Nakheel could see 40 per cent of their payment in cash by June if 65 per cent of creditors accept the terms, according to Arabtec chairman. Currently, 50 per cent have accepted. The balance 60 per cent will be paid out once 95 per cent of trade creditors agree.
Nakheel last month offered 40 per cent cash and 60 per cent in tradable security, carrying a 10 per cent annual return. The developer added that it has now secured the agreement of many of its trade creditors, representing claims of approximately Dh6 billion.
Dr Ahmed Saif Belhasa, Chairman of the UAE Contractors' Association, which held a meeting with Nakheel yesterday, said: "It was a fruitful, positive and constructive meeting with Ali Lootah who showed a great deal of understanding. The UAE Contractors' Association invites all contracting companies to immediately present their claims. This will push the building and construction sector to greater growth and will restore vitality and activity."
Arabtec Chairman Riad Kamal explained: "If 65 per cent are on board, then by June, the 40 per cent of cash payments will be issued to everyone. It was a very positive meeting and all questions were addressed. It was also a confirmation of the support that it [Nakheel] gets from the Dubai Government," Kamal told Emirates Business. "We are moving in the right direction; 50 per cent have agreed and they are waiting for 15 per cent more before they disburse the first 40 per cent. We should see that happen in the next week or 10 days and are keen about consensus because of what it will mean to the 50 per cent who have agreed so far. It is a very genuine offer and people should not miss this opportunity. As for the agreement of the rest of the 65 per cent payment, Nakheel is pretty confident that the 95 per cent consensus on the publicly traded security will happen in the next couple of months or so. There is a definite atmosphere of confidence in the whole field."
Nakheel said it had assured the Contactors' Association of the significant progress made, and clarified the need for continued co-operation from its trade creditors. "We remain optimistic of reaching a final settlement, as a precursor to making a 40 per cent cash payment to its trade creditors."