Abraaj Founder Reaches Initial Deal on $300 Million Loan

(Bloomberg) -- Arif Naqvi, the founder of embattled Dubai-based private equity firm Abraaj Group, reached an interim settlement with a creditor on a $300 million loan, his lawyer and a person close to the creditor said.

A deal was reached last week on the entire loan although it has yet to be signed, said Naqvi’s lawyer Habib Al Mulla, executive chairman of Baker McKenzie Habib Al Mulla. The settlement is only interim and not final, said the person close to creditor Hamid Jafar. They didn’t disclose the terms of the deal.

On Sunday, a court in Sharjah, the United Arab Emirates dismissed a bounced check case against Naqvi and Abraaj director Muhammad Rafique Lakhani after the complainant dropped the case. Checks had been issued as a security on a loan of about $200 million to Abraaj and $100 million to Naqvi, Al Mulla said last month.

The U.A.E. treats bounced checks as a criminal offense.

Abraaj has faced a liquidity crisis since it emerged in February that some of its investors, including the Bill & Melinda Gates Foundation, commissioned an audit to investigate the alleged mismanagement of money in its health-care fund. The buyout firm, which is undergoing a court-supervised restructuring, has been seeking to sell its fund unit and also the stakes it owns in the funds.

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