Dewa delays $19bn debt issue - Emirates24|7

Dewa delays $19bn debt issue


State-owned Dubai Water & Electricity Authority (Dewa) will wait until the second half of the year to return to the debt market after delaying a 2007 bond sale, it said on Wednesday.

Dewa has said it will need to invest $19.1 billion (Dh70.1bn) during the next four years, raising most of that through loans and bonds.

Last year, it shelved a plan to sell bonds after the US mortgage crisis made investors more reluctant to lend.

"For sukuk [Islamic bonds] we are waiting for the market to recover," Dewa CEO Saeed Mohamed Ahmed Al Tayer told reporters. "For sukuk or long-term loans, we would only go into the market after June."

Dewa is seeking to increase capacity by 150 per cent by 2012 from 5,000 megawatts of electricity and 255 million gallons per day of water as demand surges in the Gulf Arab emirate.

Long-term loans would have a maturity of 10 to 15 years, Tayer said. Sukuk forbid the receipt of interest. "Now, we are only looking for short- or medium-term loans," he said.

Dewa started the first stage of syndication for its $2 billion, one-year Islamic loan last month, bankers said at the time.

Dewa forecasts demand for power and water will grow as much as 20 per cent per year in Dubai, which is capitalising on the Gulf's windfall from record oil prices to develop tourism, trade and financial services. (Reuters)

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