Clouds over Turnberry as Dubai owner mulls sales

Published on Monday 7 December 2009 21:39

THE future of one of Scotland's premier golf resorts was last night thrown into uncertainty after a senior Dubai government official raised the spectre of an asset firesale at its heavily indebted parent company.

Dubai World, which owns Turnberry in Ayrshire, is likely to sell off a string of assets in order to raise cash, the director of Dubai's department of finance said in a television interview yesterday.

Abdul Rahman al-Saleh did not specify which Dubai World assets were under threat but he did say that assets owned directly by the Dubai government – such as its 21 per cent stake in the London Stock Exchange and the airline Emirates – would be ring-fenced.

Turnberry was bought last year by a subsidiary company of Dubai World for 55 million. Ownership was recently transfered to another subsidiary, Istithmar World, but it remains part of the Dubai World group.

Saleh told al-Jazeera television: "(Dubai World] has foreign investments and real estate investments abroad. There is nothing to prevent selling these assets."

Paul Reynolds, head of advisory operations in the Middle East, has been appointed to advise on asset disposals along with Aidan Birkett of Deloitte.

Dubai World was last night locked in talks with lenders, including Royal Bank of Scotland, Standard Chartered, HSBC and Lloyds over its request to delay repayments on its $26 billion debts.

On 30 November, Dubai World issued a brief statement, saying it would immediately consider "alternatives" in respect of its debt obligations. The statement insisted that Istithmar World, which owns Turnberry, was on a "stable financial footing".

However, last week it emerged that the second phase of a major redevelopment of the luxury resort, which has been due to start last month, had been delayed with no new start date set.

Both Dubai World and Istithmar World could not be reached for comment last night. A spokesman for Turnberry said management had not been informed of any plans to sell the hotel and that it was an "ownership issue".

Other Dubai World assets include the QE2, which is docked in Dubai, awaiting redevelopment as a floating hotel.