Dubai - Arabstoday
Economic Zones World (EZW), a unit of Dubai World, is considering the sale of its UK-based warehouse property developer Gazeley, as it looks to repay some of its debt of over $2 billion (Dh7.36 billion) this year, three banking sources said. Gazeley is one of the four businesses held by EZW, which operates technology, logistics and industrial parks as well as Jebel Ali Free Zone (Jafza) under the Dubai World Group umbrella. A potential sale of Gazeley will help EZW repay a portion of debt maturing at Jafza, the sources said, speaking on condition of anonymity. Jafza is aiming to refin-ance a $2.04-billion Islamic bond maturing next November. The firm has hired investment bank Rothschild for that process, two of the sources said. Article continues below Dubai World bought Gazeley from Wal-Mart Stores in 2008 for an estimated £300 million to £400 million (Dh1.68 billion to Dh2.24 billion) but a likely sale could only happen at a discount due to the current economic climate and lack of buyers, two sources said. \"They (EZW) have earmarked it for sale. Banks are chasing that mandate but don\'t think they have officially named anyone,\" one of the sources said. \"Gazeley is a mediocre asset. They will be lucky to generate the purchase price on it given the current market conditions,\" he added. Gazeley has so far developed around 6.4 million square metres of warehousing, according to the company\'s website. EZW declined to comment on the matter. Confident Its chairman Hesham Abdullah Al Shirawi said last month that he does not rule out asset sales to help raise funds to pay off Jafza\'s debt but said the company does not need to seek government support. Ratings agency Moody\'s said last month that Dubai, which has restructured some $41 billion in debt related to Dubai World, faces refinancing risks related to three state-linked entities, including Jafza. Rival ratings firm Standard & Poor\'s has named the Jafza bond maturity as among Dubai state-linked obligations in 2012 with the greatest chance of encountering repayment issues.