Sharjah-based Dana Gas has said it is in discussions with holders of the firm’s $920m sukuk (Islamic bond) about reaching a standstill agreement on the debt, which was due to be repaid on 31 October.
The failure to repay the sukuk when it was due makes it the first company in the UAE to miss a repayment obligation on its capital markets debt. The standstill agreement would require creditors to put off attempts to enforce a default and try and claim assets of the firm in order to be repaid.
Dana Gas has also said that it is unaware of any attempts by the sukuk holders to enforce action against it in relation to the failure to repay the bond, despite some reports that creditors had begun such action. The sukuk is secured against Dana Gas assets in Egypt and two wholly owned subsidiaries in the UAE, the United Gas Transmission Company and SajGas.
Bond holders are still deciding on the course of action to take following the missed repayment by Dana Gas. The company has hired Germany’s Deutsche Bank and the US’ Blackstone Group and Latham & Watkins as advisers on the restructuring of the sukuk.