Rothschild Bankers appointed to help sell Dubai World assets

Bankers from Rothschild have been appointed to help restructure Dubai World with a mandate to dispose of some of the stricken conglomerate’s famous assets.

Paul Reynolds, head of Rothschild’s advisory operations in the Middle East, was this week asked to work for the Dubai government’s chief restructuring officer alongside Aidan Birkett of Deloitte, who was appointed on Wednesday.

The team is tasked with assessing the group’s assets, which is likely to result in a large scale sell-off of assets as varied as the QE2 cruise liner; Turnberry, the golf course that hosted this year’s Open Championship; and a raft of properties.

A spokesman for the Dubai department of finance confirmed that all options and asset sales would be considered, except for the DP World subsidiary that bought P&O, the British ports company. “I’m sure all of the assets of Dubai World will be reviewed,” he said. “The QE2 is one of them. It’s part of the restructuring process, though it’s too early to say whether there’s any sale in mind.”

The neighbouring emirate of Abu Dhabi is seen as one of the main buyers of Dubai’s assets. Last year when rumours about Dubai’s debt problems first started, sources said Abu Dhabi had offered to buy Emirates but Dubai had so far refused to part with its flagship carrier.

Abu Dhabi is also said to be interested in Emaar, the property company that owns the Burj Dubai skyscraper, the Dubai Mall shopping centre, and Dubal, Dubai’s aluminium company.

However, the assets in Dubai World are more likely to be sold first. The group’s biggest problem area is thought to be Nakheel, its property arm that owns the Palms, the ambitious man-made islands. Nakheel also has two hotel chains, one of which owns the Turnberry Hotel.

Dubai World’s venture capital arm, Istithmar, owns stakes in global assets including Barneys, the New York department store; Cirque du Soleil, the South African entrepreneur Sol Kerzner’s hotel chain; and Standard Chartered bank. The company has also bought into MGM Mirage, the Las Vegas gambling operation – even though gambling is banned in Dubai – and Troon Golf.

London properties include Adelphi on the Strand and the Grand Buildings in Trafalgar Square.

Rothschild was one of five banks working in recent months to help Dubai World meet its debt obligations. Deutsche Bank was the other lead adviser and they were supported by Citibank, JP Morgan and the Dubai Islamic Bank. When the standstill decision was taken on Wednesday, all the banks were stood down as the mandate had changed.

Rothschild and Deloittes declined to comment.

By Louise Armitstead and Richard Spencer in Dubai
Published: 12:01AM GMT 28 Nov 2009

Source: The Telegraph

More on Dubai:

United Arab Emirates’ central bank to Back Banks in Dubai Meltdown

Paul Krugman: Dubai or not Dubai — that is the question

Bank of America: Dubai Woes May Reach ‘Sovereign Default’

Dubai meltdown: Crash hits new low; The emirate can no longer meet its obligations; Celebrities caught out

Dubai: Real Estate Down 50% From Peak

From the Palm Islands to Emirates Bank, grand Dubai, United Arab Emirates, feels the economic crunch

Dennis Kucinich: Bailout Money Going Overseas

In Dubai, guest workers are stranded without jobs

Dubai property chief rounds on accusers

Dubai will soon be looking like a ghost town

Dubai Real Estate Crash

Sun, sea and sewage in the playground of the rich in Dubai

Arab countries have lost $2.5 trillion in the past four months

Once Booming Dubai Goes Bust

Gulf stocks plummet in turbulent year; Dubai shedding almost three quarters of its value

Leave a Comment