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.

State-owned Kuwait Airways has delayed plans to privatize the airline and will now push ahead with a restructuring of the ailing carrier, a committee formed for the privatization process said, Reuters reported. The national carrier, which was established in 1954, has been struggling to cut losses and increase revenues amid rising competition from other regional carriers like Dubai's Emirates and Abu Dhabi's Eithad Airways.

Two years after the Dubai debt crisis erupted, contributing to a wave of loan restructurings across the Gulf, those restructurings may be entering a more difficult phase as banks become reluctant to extend maturities further, the Kuwait Times reported. Government-related and private companies in the region have so far avoided defaults by agreeing with creditors to push out maturities-a process labelled "extend and pretend" by some cynical bankers. This method has helped banks avoid billions of dollars in writedowns and companies to avoid the shame of defaulting.

The shipbuilding division of troubled state conglomerate Dubai World said Tuesday it is determined to hammer out a $2.2 billion debt restructuring deal, despite a legal challenge from one of its creditors, CanadianBusiness.com reported on an Associated Press story. The unit, known as DryDocks World, gave no indication when it expected the restructuring to be completed. It has been in talks with lenders for months to retool the terms of the loans, which were excluded from its parent company's own high-profile debt talks.