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Report: UAE's Abraaj eases creditors' concerns over liquidity

Abraaj Group Ltd. has assured creditors that planned sales of stakes in its fund management unit and Pakistani power utility K-Electric Ltd. will help address any potential liquidity problems, Bloomberg News reported May 14, citing people with knowledge of the matter.

The United Arab Emirates-based private equity company met with banks, including Mashreqbank PSC and France-based Société Générale SA, in the week of May 7 to make assurances that it is close to finding a buyer for the asset management unit stake and will soon complete the sale of its holding in K-Electric, the sources said.

Abraaj is said to be in preliminary discussions to sell a majority interest in its fund management unit to U.S. diversified real estate investment trust Colony NorthStar Inc.

One of the sources said the group secured a loan from Mashreqbank pledging the proceeds from the power utility firm's sale. In October 2016, Abraaj agreed to sell a 66.4% stake in K-Electric to Shanghai Electric Power Co. Ltd. for $1.77 billion; however, the transaction was held up due to electricity tariff negotiations with the government, people aware of the matter told Bloomberg.

Abraaj is attempting to steady its business amid a disagreement with four investors in a $1 billion healthcare fund, who suspect that their money had been misused.