Dubai fund may extend talks with banks on Colonial offer

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Talks between Investment Corporation of Dubai (ICD), and the shareholders and creditor banks of Colonial on the sovereign wealth fund's buyout offer for the debt-laden Spanish property company continued yesterday.

20 March 2008

MADRID - Talks between Investment Corporation of Dubai (ICD), and the shareholders and creditor banks of Colonial on the sovereign wealth fund's buyout offer for the debt-laden Spanish property company continued yesterday.

At print time, there was no indication whether the parties in the talks had reached an agreement ahead of the midnight deadline set by ICD. However, Reuters quoted sources close to the negations as saying that the deadline could be extended.

The talks involve three different sets of creditors: those which financed core shareholders Luis Portillo and the Nozaleda's family's stakes in Colonial, four foreign banks which granted the real-estate firm a EUR 7.2-billion syndicated loan and other creditors. The buyout is conditional on its approval by creditors.

Colonial's share price closed yesterday down 3.77 percent at EUR 1.02. The Dubai fund's offer of EUR 1.19 per share only covers Colonial's rental business, which accounts for about 80 percent of its business. Portillo and the Nozaledas, who own 52 percent of Colonial, have agreed to accept the offer.

Prior to launching a takeover offer, ICD wants Colonial shareholders to spin off its land and property development division.


[Copyright EL PAÍS 2008]

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