Abu Dhabi-listed Dana Gas said it had obtained an injunction from Sharjah Federal Court of First instance, blocking any claims on its $700 million sukuk or Islamic bond, the natural gas firm said on Wednesday.
The inunction restrains any holders of the sukuk from enforcing payments on the outstanding value until a final decision is made by the court. An initial hearing is scheduled for December 25.
It added in a later statement that it had also obtained an injunction from the Commercial Division of the High Court of Justice in British Virgin Island, retraining any action against its assets in BVI.
Dana announced on Tuesday that it had recently received legal advice that its sukuk were not sharia-compliant and were therefore "unlawful" in the UAE and a result it would be necessary to restructure the sukuk “to ensure that it conforms to the relevant laws for the benefit of all stakeholders.”
It proposed to exchange the Sukuk with a new enforceable, Shari’a compliant instrument, which would have a tenor of four years, confer rights to profit distributions at less than half of the current profit rates and without a conversion feature.
Earlier in May, Dana Gas said it would begin restructuring discussions with the holders of the sukuk issued 8th May 2013, due to continued challenges around cash collections which is forcing the company to consider preserving short to medium-term cash.
The $700 million sukuk is split into a $350 million 9 per cent ordinary certificates and $350 million 7 per cent exchangeable certificates, each due October 2017.
Dana Gas has in the past cited cash receivable delays from the Kurdistan Region of Iraq as well as from Egypt. At the end of 2016, the Sharjah-based gas firm said it collected about 64 per cent of receivables due from Egypt amounting to $79 million. Outstanding receivables as of 2016 December-end were $265 million, it had said in a previous statement.