|By TAP Staff| Dubai developer Limitless has failed to repay over $500 million, which it had promised to pay banks from the proceeds of a land sale in Saudi Arabia as part of the debt restructuring deal with the banks and this has apparently caused concern among the banks.
Last week Bloomberg had reported that the developer should have paid about $517 million to banks more than four months ago, but has not done so.
According to Bloomberg, the company is refusing to pay creditors until they agree to a restructuring proposal for an additional $648 million of debt. Banks don’t agree with the terms of the new offer and are refusing to approve the deal, leading negotiations to stall, the agency quoted people with knowledge of the issue as saying.
Limitless had promised in in June it would pay the money, equivalent to about 42 percent of the company’s outstanding bank debt of AED 4.45 billion after selling a plot of land in Riyadh to Saudi Real Estate Co. It also agreed to an additional AED176 million payment to trade creditors.
The company began talks to restructure a $1.2 billion Islamic loan for a second time last year. According to Bloomberg, company Chairman Ali Rashed Lootah said earlier this year that he hopes the company will be debt-free by 2018 and making a profit before then.
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