Gulf Finance House asks for extension on $300m loan

02 February 2010

Extension request comes after failed attempt to refinance loan last year

Bahrain’s Gulf Finance House has asked banks for an extension on a $300m loan facility that is due to be repaid on 10 February, according to bankers based in the kingdom.

The bank is scheduled to meet lenders in London on 2 February to discuss a repayment plan that bankers close to the deal say involves an offer to repay $200m of the loan on the maturity date, followed by a six-month extension of the last $100m .

Gulf Finance House said in a statement that it had “met with WestLB, the syndicate manager, last week in London to discuss our Standard & Poor’s (S&P) rating and the terms of our current facility.”

It would not comment further on the possible extension to the loan.

In July last year the bank mandated Germany’s Deutsche Bank to refinance the loan, but the deal failed to secure fresh commitments and was withdrawn from the market in September (MEED 15:11:09).

Gulf Finance House has had a difficult few months. In December 2009 it announced the departure of chief executive Ahmed Fahour, who had only joined the bank five months earlier in July.

He has been replaced by Ted Pretty as acting chief executive. On 14 January S&P downgraded the firm to B+ from BB+, pushing the company further into non-investment grade, or junk bond, status.

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