Dubai World sells its UK logistics business
Dubai World subsidiary Economic Zones World (EZW) sold its British logistics business, Gazeley, for an undisclosed sum, Reuters reported yesterday.
Dubai World bought Gazeley, a developer of logistics parks and warehouses, from Wal-Mart Stores in 2008 for an estimated US$450-$600m.
The government-owned Dubai World needs to repay almost $15 billion by 2018, of which $4.5 billion is due in 2015. It is expected to sell off more of its assets before 2015.
EZW is the parent company for the Jebel Ali Free Zone (Jafza). Last year Jafza priced the issuance of $650 million Sukuk Certificates (Sukuk) due in 2019, marking the company’s first US dollar-denominated issuance and its first transaction in the international debt capital markets since 2007.
The proceeds of the Sukuk (a Sharia compliant bond) were used to partly refinance Jafza’s outstanding Dh7.5 billion Sukuk due in November 2012, ahead of the stated maturity. Jafza also contributed proceeds of Dh4.4 billion to a bank facility and its own cash sources towards the redemption of the bond.
EZW has pledged up to $300 million to Jafza from the Gazeley sale proceeds to help repay its debt.
The firm that purchased Gazeley is Canadian investor Brookfield Asset Management.