The due date for the repayment of this syndicated refinancing, called  an ‘Ijara,’ or leasing facility, is April 13 and will be arranged by seven foreign banks  and eight local banks. Dubai Islamic Bank will be the lead arranger, and some newly established Islamic banks are likely to take part in this financing, a person familiar  with  the  deal  told 
Khaleej Times.

The Dubai Electricity and Water Authority, or DEWA, is borrowing for a three-year  period this time, compared with two years in 2007.

Saeed Mohammed Al Tayer, Managing Director and Chief Executive Officer of  DEWA, described the outlines  of the syndication on Monday, after signing a joint-venture deal with Ducab and the Abu Dhabi Water and Electricity Authority. “The refinancing is on track, and we will be able to pay ahead of time,” Al Tayer added. DEWA is the latest Dubai government-owned entity to tap the loan market in order to refinance its existing debt. In February, Borse Dubai, the state-owned holding company of NASDAQ Dubai, raised a $2.5 billion loan to refinance part of a $3.4 billion facility.

In all, Dubai’s government-owned borrowers have $11 billion of foreign loans coming due before the 
end of next year.

They will need to make four large repayments over 2009-10 period.  The first  repayment — the DEWA loan — is to occur next month,  according to investment bank EFG-Hermes. The remainder will come due between December 2009 and June 2010.

DEWA currently has a power output capacity of  6,676 megawatts  and an average  consumption during peak hours of 5,287 megawatts. It has a surplus capacity of 1,389 megawatts, which exceeds by 26 per  cent the electricity  that Dubai requires  during  peak  usage.

Al Tayer said  that electricity  production  capacity would reach 7,287 megawatts  by the end of this year,  up  nine  per cent from present levels.

·         abdulbasit@khaleejtimes.com