SOVEREIGN DEBT RESTRUCTURING | MASTERCLASS

A deep dive masterclass on sovereign debt restructuring, to be conducted virtually by Asian high yield bond expert Florian Schmidt.

30 June 2022 (Thu), 5pm Singapore/HK time

Marine terminal operator DP World and Canadian investment group CDPQ have announced an investment deal of $5bn in three of DP World’s key UAE assets. CDPQ will invest $2.5bn in the Jebel Ali Port, the National Industries Park, and the Jebel Ali Free Zone through a new joint venture (JV) in which they will hold a 22% stake. The JV will then raise debt to finance the remaining $2.5bn investment. Other long-term investors can acquire an additional stake of up to $3bn. The deal implies a total enterprise value of ~$23bn for the three assets. The three assets combined, form an integrated ecosystem for the supply and logistics chains of over 8,700 companies from around the world, serving more than 3.5bn people globally. In 2021 they generated a combined revenue of $1.9bn. Tranche 1 of the deal with the $5bn investment by CDPQ is expected to close by Q2 or Q3 2022. Tranche 2 of up to $3bn will be completed by Q4 2022.  DP World expects the given deal will enable them to reduce net leverage (Net debt/EBITDA) to below 4x and would further strengthen its balance sheet. As per Bloomberg, the deal will help DP World repay $7bn in debt due 2023.

DP World’s dollar bonds were trading stable with its 3.908% 2023s at 100.51 yielding 3.37%.

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