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Shuaa Capital has reached the final stage in its debt restructuring exercise, reaching agreement with its senior creditor FAB, the UAE’s largest lender, to restructure AED 208 million ($57 million) in outstanding facilities.
The investment bank has agreed on a 12-month temporary waiver of principal instalments and an extension of the existing loan with its senior creditor.
While FAB has not been named by Shuaa, Zawya understands from multiple sources that the Abu Dhabi-listed bank is Shuaa’s senior creditor.
The agreement paves the way for the issuing of Dubai-listed Shuaa’s mandatory convertible bonds (MCBs), which sources said could be launched as early as this week.
The board approved the waiver agreement on Friday, the week after reaching an amicable agreement with another main creditor.
CEO Wafik Ben Mansour said the investment bank had addressed AED 1.2 billion of debts since the start of 2024.
The MCBs, which will convert into equity in the investment bank, were first announced in May, and will replace existing facilities.
Shuaa was forced to negotiate for a second time with bondholders of its expired $150 million bond in April.
A new board and chairman were appointed earlier this year. The new board lineup followed a series of high-level management resignations following the exit of its former largest individual shareholder in Q3 2023.
The investment bank’s losses shot up in 2023 but narrowed this year, with a loss of AED 22 million reported for Q3 2024, compared to AED 806 million in Q3 2023.
(Reporting by Imogen Lillywhite; editing by Bindu Rai)
