(Bloomberg) — Two of Dubai’s biggest banks bought loans made to DXB Entertainments PJSC from other regional lenders as part of plans by its majority owner to support the struggling theme park operator, according to people with knowledge of the matter.
Emirates NBD PJSC and Dubai Islamic Bank PJSC acquired the debt from mainly non-United Arab Emirates-based lenders at a discount so Meraas Holding LLC can restructure the park operator with a small group of Dubai-based banks, the people said, asking not to be identified because the information is private.
DXB Entertainments, which hasn’t posted a profit since listing in 2014, is set for another year of pain as the coronavirus hits visitor numbers at the three theme parks it operates in Dubai. The outbreak adds to the challenges it’s already facing as ongoing property and retail slump weighs on the economy. Last year, the company scrapped plans to open a Six Flags theme park in the emirate when funding became unavailable.
Government-backed Meraas holds a 52% stake in DXB Entertainments, which also counts Qatar’s sovereign fund and Kuwait Investment Authority as other shareholders. The company has about $1.5 billion of debt, according to data compiled by Bloomberg.
Representatives for Meraas, DXB Entertainments, Emirates NBD and Dubai Islamic Bank declined to comment.
Shareholders will meet on March 24 to approve the continuity of DXB Entertainments’ operations and discuss a plan to address the company’s accumulated loss, according to a statement on Monday.
Before the coronavirus spread to Dubai, DXB Entertainments Chief Executive Officer Mohamed Almulla said the outlook for 2020 was “good” with expectations of a profit in the first and fourth quarters and losses in the second and third.
DXB Entertainments opened its doors in 2016 as part of plans to bolster Dubai’s position as the Middle East’s entertainment hub.