Dubai World said Monday is was planning a restructuring of some of its units in a move covering $26 billion in debt, according to a company statement. “The proposed restructuring process will only relate to Dubai World and certain of its subsidiaries, including Nakheel World and Limitless World,” it said. “The total value of debt carried by the companies subject to the restructuring process amounts to approximately $26 billion, of which approximately $6 billion relates to the Nakheel Sukuk (Islamic bonds),” the statement said. “Following a detailed review of the Group's liquidity and capital structure, Dubai World has concluded that it should immediately consider alternatives in respect of the debt obligations of certain entities within the Group,” it said. Wednesday's debt freeze announcement sent shockwaves around the world on Thursday and Friday as investors feared a possible default by Dubai and its state-owned businesses, which together owe an estimated $80 billion. “Initial discussions have commenced with the banks of Dubai World and are proceeding on a constructive basis.” It said the restructuring would not include “Infinity World Holding, Istithmar World and Ports and Free Zone World (which includes DP World, Economic Zones World, P&O Ferries and Jebel Ali Free Zone), all of which are on a stable financial footing.” Dubai World's total liabilities as of August reached nearly $60 billion. Dubai World triggered a worldwide stock market sell-off last week after announcing that it may delay payment on billions of dollars of debt. The news sparked worries that Dubai World could default on its entire $60 billion in debt and trigger a new global credit crisis.
