Saudi Arabia's Algosaibi family to go back to credit market

Bloomberg - Algosaibi family is keeping many of their company operating businesses as part of a deal with creditors and will eventually look at restore them by going back to the credit market, according to Simon Charlton, Saudi Conglomerate chief restructuring officer.

We need to go through the restructuring, there are various steps we need to take to meet our obligations under the agreement, Charlton said in an interview with Bloomberg Television on Sunday.

However, we are looking to return to the market where it would make the most sense and at what sort of level in the hope that that will bolster the businesses and help them to return to their former glory, he said.

After having been locked in legal battles and negotiations with creditors over $7.5 billion of debt since 2009, Ahmad Hamad Algosaibi Brothers Co. had its proposal to restructure the obligations ratified by a Saudi Court - in the first major test for the kingdom's new bankruptcy law.

The order from the commercial court in Saudi Arabia's eastern province of Dammam will allow various asset freezes to be lifted and let AHAB, as the company is known, go ahead with a plan to repay creditors about 26% of their claim values through a mixture of cash, shares and Saudi real estate.

The company was also locked in a legal dispute with Maan Al-Sanea, which is owned by the Saad Group and defaulted on billions of dollars in 2009 as the global economic crisis froze credit markets and asset prices slumped. Charlton is also going through the bankruptcy process in Saudi Arabia and is probably two or three years behind AHAB, according to Saad Group, who has said that he isn t directly involved with this process.

BNP Paribas SA and Citigroup Inc. were among the global banks with the most exposure to AHAB. Since its default, many banks have sold off their exposure to hedge funds to the firm.