Interest-free loan will meet the immediate working capital requirements of Drake & Scull International
Drake & Scull International, the Dubai-based engineering and related services contractor, has announced that it will receive an interest-free loan of up to $27.2 million from Tabarak Investment, as part of DSI’s capital restructuring programme.
Known as a ‘Qard Hasan’ loan, it will help meet the immediate working capital requirements of DSI until it completes its capital restructuring programme, which includes a capital increase of $136.1 million to expedite Tabarak Investment’s entry as a strategic investor.
In a statement, the contractor said that the withdrawal and payment mechanisms of the loan will be mutually agreed upon by the two parties. It added that it could be implemented in trenches.
“The extension of this loan from Tabarak Investment will ensure business continuity particularly by addressing our immediate working capital requirements under the initial phase of our capital restructuring program. We appreciate Tabarak’s full support as we realign the company towards long-term financial stability and profitability,” said Mohammad Atatreh, board member, Drake & Scull International.
Phase one of DSI’s capital restructuring program is underway, and will see the company’s capital officially reduced by 75% within a few weeks, the company said. The loan from Tabarak will bridge DSI’s working capital requirements and improve its liquidity position as it looks to win new project awards.
“Tabarak Investment’s loan is a key development that will further ensure the success of our efforts to direct DSI towards a new period of financial and operational success. We assure our stakeholders that our program is proceeding according to plan and will soon position us for further growth,” said Wael Allan, CEO of DSI.
“Our loan is intended to ensure that DSI’s restructuring program proceeds as smoothly and as swiftly as possible. We are fully committed to sustaining the company’s industry leadership and pursuing a mutually beneficial future,” added Ahmed Kilani, CEO of Tabarak Investment, in conclusion.