North Africa/Middle East

Spanair SA, the Spanish airline involved in a crash that killed 154 people in 2008, ceased operations after Qatar Airways Ltd. halted takeover talks and the regional government refused to provide further funding, Bloomberg reported. The final flight landed at about 10 p.m. Friday, the Barcelona-based carrier said in an e-mailed statement, citing “a lack of financial visibility for the coming months.” The closer may affect as many as 23,000 passengers this weekend and will see 120 flights canceled, spokeswoman Sandra Melendez said.

The International Monetary Fund warned on Tuesday that global growth prospects had dimmed as the sovereign debt crisis in the euro zone entered a “perilous new phase,” the International Herald Tribune reported. Releasing quarterly updates of three reports on the outlooks for the economy, debt and global financial stability, the fund cut its estimates of global growth this year to 3.25 percent, from the 4 percent it forecast in September, on “sharply escalated” risks emanating from Europe.

The International Monetary Fund has asked its member countries for an extra $500bn in firepower to combat the world’s spreading fiscal emergencies, which it estimates will generate demand for bail-out loans totalling $1tn over the next two years, the Financial Times reported. The estimate was presented by Christine Lagarde, IMF managing director, to the fund’s executive board this week, according to people familiar with the discussions, and would most likely be financed by voluntary ad hoc loans rather than mandatory contributions. The IMF currently has $387bn in available resources.

The European debt crisis is hitting home in the oil-rich Gulf as companies struggle more than ever to hammer out large-scale restructuring deals with international banks, prompting concerns over a wall of refinancing required this year, the Financial Times reported. With the prospect of about $25bn in bonds and sukuk maturing in the region this year, bankers are becoming increasingly concerned that casualties will emerge.

The number of failed companies is expected to rise by 3 percent globally this year, led by Europe, under the weight of an economic slowdown and tighter monetary and budgetary policy, credit insurance company Euler Hermes said in a report, Reuters reported. Failures will likely increase by 12 percent in the euro zone, including a 19 percent rise among Mediterranean countries that have been "very weakened by the crisis", Euler Hermes Chief Economist Ludovic Subran said. Euler Hermes economists expect global gross domestic product growth to slow to 2.7 percent this year from 3 percent in 2011.

Kuwaiti retailer Alshaya has bought 60 La Senza UK stores, rescuing about 1,100 jobs, from the administrators of the stricken lingerie chain, Reuters reported. Alshaya bought the shops and UK brand in a so-called pre-pack deal after KPMG was appointed administrator to the company on Monday. Another 84 stores and 18 concessions had closed, the administrators said, resulting in about 1,300 job losses. The company was owned by Lion Capital, which had announced 81 of the closures on December 30.

The Algerian subsidiary of ArcelorMittal, the iron and steel multinational, faces bankruptcy at its plant in El-Hadjar in the east of the country, a union official said Thursday, Agence France-Presse reported. "The declaration of bankruptcy is imminent. The complex is crushed under a debt of $120 million," the secretary-general of the Smain Kouadria union told AFP, Dow Jones Daily Bankruptcy Review reported.

The UAE’s insolvency laws have been in force since 1993 but lawyers are hard pressed to come up with a single example of their being used to wind down a struggling company. Untested and widely regarded as unworkable, they are in bad need of replacement, the Financial Times beyondbrics blog reported. The juddering impact of the global financial crisis has persuaded the government to draft a new set of regulations, which will hopefully allow companies to conduct orderly wind-downs through the courts. It won’t be easy.

A potential $2.2 billion debt restructuring for Drydocks World, the shipbuilding arm of indebted Dubai World, is seen facing tough headwinds with the presence of hedge funds and a lack of government aid seen threatening an amicable deal, Reuters reported. Drydocks has set up a committee to thrash out an agreement for the restructuring of its $2.2 billion debt pile. The firm missed a payment deadline for a $1.7 billion three-year loan facility that it took in October 2008. It also has another five-year $500 million facility on the restructuring table.

The UAE is in the final stages of framing regulations on insolvency, foreign investment and arbitration, Dr Hadef Bin Jua'an Al Daheri, the UAE Minister of Justice, has told Gulf News. Speaking ahead of the International Bar Association Annual Conference (IBA), which opened in Dubai yesterday, Al Daheri said that the UAE's legal environment has become a role model for the region. "There are some laws that are under study and these include the arbitration law, the foreign investment law and the insolvency law, as well as others.