One of Kuwait's largest investment companies secured approval today to raise as much as 100 million dinars (Dh1.26 billion) of capital in an effort to shore up its finances after a US$1.7bn (Dh6.24bn) debt restructuring. Global Investment House, which signed a deal with 53 creditor banks last December to reschedule $1.7bn of debt over three years, received approval from shareholders for the increase in capital at its annual general meeting.
The company's shares are listed on the Kuwait Stock Exchange. Raising new money from investors was "important in enhancing the company's financial position and as a safeguard for what could happen in the future if the prices of assets don't improve in the short term", said Maha al Ghunaim, the company's managing director, after the meeting, according to Bloomberg. Global was forced to restructure its debts after turmoil in regional economies and tightening credit markets made it unable to refinance loans.
The company defaulted on a $200m loan in December 2008 and reported losses of 257.6m Kuwaiti dinars that year. The company trimmed its losses for last year to 148.8m dinars, and Ms al Ghunaim said yesterday that Global was "very pleased" with fee revenues this year. These included income from advising on the sale of Zain's African assets to Bharti Airtel for $9bn. Zain is the Kuwait's largest telecommunications company.
Global also said that it made its first payment of about $29m on its restructured loans last month.