Abu Dhabi-listed shares jump by 4.8 per cent, as sources close to the company say a standstill agreement is in place over sukuk.
Dana Gas rebounds despite missed bond deadline
Dana Gas shares jumped 4.8 per cent as markets began trading after the company said it had missed a payment deadline for a $920m bond.
The sukuk matured at midnight yesterday, but Dana Gas remains in negotiations with creditors.
Sources close to the company said on Tuesday that a six-month standstill agreement is in place with lending banks.
A standstill is an agreement among creditors that they will not press claims against a company over its outstanding debts, averting a default.
"The desirability to amend and extend the terms of the sukuk became evident in the interests of all stakeholders owing to the recent liquidity challenges that have emerged as a result of challenging external macro-economic and political circumstances in the region, including the extensively reported problems of payment delays where the company operates," Dana Gas said in a statement.
"Until this date, the company has consistently honoured its payment obligations," the company added.
Dana’s Abu Dhabi-listed shares rose as much as 4.8 per cent to Dh0.43 each in early trading, but later pared gains.
The Sharjah-based company also reported net income of Dh104 million (US$29m) in the third quarter of this year, a decline of 27.2 per cent compared with the same period last year, driven by a fall in sales.
The company's revenues fell by 20.6 per cent to Dh512m during the same period.
"Dana Gas remains committed to finding a consensual solution that is fair and equitable to all stakeholders and will make further announcements in line with the progress of discussions," the company added.