DUBAI (Zawya Dow Jones)–Nakheel, the real-estate unit of Dubai government-owned conglomerate Dubai World, Wednesday said its chief executive, Chris O’Donnell, will step down by mid-June after five years in the post.
O’Donnell has “decided to leave after completing his contract terms,” and will be replaced temporarily by the current chief financial officer, Sanjay Manchanda, until a permanent replacement is found, Nakheel said in an emailed statement.
O’Donnell leaves Nakheel as the company is expected to finalize its debt restructuring plan with its creditors.
Nakheel’s trade creditors last year were offered repayment through a mix of 40% cash and 60% via Islamic bonds, or sukuk, as part of its debt restructuring. The company said in March it had paid 4.6 billion U.A.E. dirhams ($1.25 billion) to trade creditors so far, with the sukuk still to be issued.
The property firm in March said the restructuring process was expected to be concluded by mid-2011. The company said at the time it would soon start issuing restructuring agreements–including the sukuk term sheet–to eligible trade creditors that had already signed restructuring undertakings.
Nakheel fell into financial trouble in late 2009 after being hit hard by the fallout from the global financial crisis, which saw housing prices in Dubai slump and a real-estate bubble burst. The developer ramped up billions of dollars worth of debt during years of spending on some of the world’s most extravagant real-estate projects such as Dubai’s palm tree-shaped artificial islands.