GIH wins $250m NBQ case

Kuwait's Global Investment House (GIH) said it won a long-running legal battle over an aborted buy of a stake in National Bank of Umm Al Qaiwain (NBQ) after an appeals court ordered the Abu Dhabi-listed bank to return its deposit plus interest. The $250 million sum was placed with NBQ in August 2008 as the first part of Global's purchase of a 20 per cent stake in the bank through a Dh2.36 billion ($642.5 million) convertible bond issue. However, as financial markets slumped in late-2008 and the Kuwaiti firm encountered debt problems which forced it into a restructuring, Global cancelled the planned purchase and wanted the money back, but NBQ said it was entitled to keep it. Last year, Global won an initial ruling from a Dubai court which NBQ later appealed. A UAE court halted the refund decision in June pending the appeal. On top of the $250 million original deposit, NBQ will also pay an extra $79 million in interest, Global said in a statement on the Dubai bourse. The money will be used to strengthen the company's financial position, it said, without elaborating. The company is in the midst of a second debt restructuring in three years. Having completed a $1.7 billion rescheduling in 2009, it said in September it would ask creditors to halt repayments while it sought a new deal. Shares in Global, one of the largest investment houses in the Gulf state, have not traded on the Kuwait Stock Exchange since December after the bourse suspended the stock for having accumulated losses which exceeded 75 per cent of its capital. Earlier this month it reported a third straight yearly loss of 57.5 million dinars ($207.1 million).