Abu Dhabi’s Aldar Properties has secured a AED4bn (US$1.09bn) credit facility from National Bank of Abu Dhabi, a deal expected to help the struggling developer manage its liquidity needs.
The three-year revolving facility, which was undrawn at signing, will be used for general business purposes, Aldar said in a emailed statement.
The funds from the deal will allow the company to manage its working capital and liquidity requirements over the next three years, it said.
No terms of the deal were provided in the statement, the latest show of financial support for the emirate’s flagship developer which has been hit hard by slumping real estate value in the United Arab Emirates (UAE).
National Bank of Abu Dhabi is the largest lender by market value in the UAE and over 70-percent government-owned.
Aldar has been bailed out twice by the Abu Dhabi government with rescue packages totalling over US$10bn.
State-owned investment fund Mubadala, which holds a near-majority position in Aldar said last month that it transferred a 14 percent stake in the developer to secure a loan facility from another Abu Dhabi lender.
Talks are also underway for a possible merger of the developer with rival Sorouh Real Estate, as Abu Dhabi looks to consolidate its property sector. Shares of Aldar were flat on the Abu Dhabi bourse following the announcement.
Aldar’s US$1.25bn 10.75 percent bond, maturing 2014 was bid at 109.244 on Tuesday, according to Thomson Reuters data, to yield 6 percent, down about 10 basis points since the beginning of the month.
The builder of the Yas Marina Formula One circuit has been forced to sell key projects to the government including the Ferrari World Theme Park.
The announcement comes after the UAE’s central bank amended large exposure limit rules for state-linked firms earlier this month, setting a limits of 100 percent of the capital base for all lending by a bank.