Abu Dhabi’s IPIC: 1MDB still owes $629 million on 5.75%, 5.99% notes

By Susanna Moon

Chicago, Aug. 1 – Abu Dhabi’s International Petroleum Investment PJSC, or IPIC, said it has still been unpaid the $602,725,000 and $26,024,509.59 due Monday under the consent award and settlement by the Minister of Finance (Inc.) Malaysia and 1Malaysia Development Bhd.

Under the settlement, there is a cure period of five business days for MOF Inc. and 1MDB to remedy their non-payment before they owe additional obligations to IPIC and Aabar Investments PJS, according to a company notice.

IPIC said on April 24 that it would assume responsibility for payments on the $1.75 billion 5.75% notes due 2022 issued by 1MDB Energy (Langat) Ltd. and $1.75 billion 5.99% notes due 2022 issued by 1MDB Energy Ltd.

The notes are guaranteed by 1Malaysia Development and IPIC, and payments include interest and principal, according to a previous company notice.

Separately, the company reached an agreement for a settlement with Aabar Investments PJS, the Minister of Finance (Inc.) Malaysia and 1Malaysia Development.

Under the settlement terms, IPIC was to receive $602,725,000 by July 31 and another $602,725,000 by Dec. 31.

The settlement is for the arbitration proceedings at the London Court of International Arbitration, contingent on the arbitration tribunal making a consent award by May 31, the company previously noted.

IPIC said about a year ago on May 11 that it had paid the $52,412,500 interest due on the 5.99% notes out of existing liquidity and under its obligations under the notes guarantee following the latest default by 1MDB.

After that default, which was the third, IPIC said it would increase its written demand for 1MDB and Minister of Finance, Inc., Malaysia to fully indemnify IPIC for the guarantee payment, the interest paid on April 29 and the outstanding sum that was due to be paid to IPIC by Dec. 31.

The total amount due to IPIC from 1MDB and the Minister of Finance under the terms of the binding term sheet was $1,205,450,000 plus accrued interest, the release said.

1MDB is a strategic development company based in Kuala Lumpur, Malaysia, owned by the government of Malaysia and established to drive strategic initiatives for long-term economic development.

IPIC is a sovereign wealth fund of the Emirate of Abu Dhabi.

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