A unit of Dubai World has sold its Atlantis resort, which sits at the head of a palm tree-shaped island in the emirate, as the state-owned group raises funds to meet huge debt repayments after a USD$25 billion restructuring in 2011.
Investment Corp of Dubai (ICD), a state-owned holding company, has bought the resort from the unit, Istithmar World, for an undisclosed sum, ICD said on Thursday.
"Our acquisition of an asset that is a major contributor to the domestic tourist industry is in line with our overall strategy to support long-term sustainable growth for Dubai," Khalifa Al Daboos, deputy chief executive of ICD, said in the statement.
A spokesman for Istithmar in Dubai declined to comment.
The sale adds to a series of disposals by Dubai World, which had promised to sell non-core assets under the debt-restructuring plan drawn up when the group fell victim to a property market crash in the emirate and the after-effects of the global financial crisis.
The firm needs to repay USD$4.4 billion in May 2015 under its restructuring terms.
Dubai's economy is recovering due to renewed investor optimism in its trade, tourism and real estate sectors but the freewheeling emirate still faces debt repayments of about USD$50 billion over the next three years.
Atlantis was set up in 2008 as a joint venture between Istithmar World and Kerzner International. In April 2012, Istithmar acquired Kerzner's 50 percent stake in the property for USD$250 million.
The Atlantis sale is Dubai World's second disposal this year after selling British logistics warehouse developer Gazeley in June. It is close to selling The Fontainebleau hotel in Miami Beach.
State-owned ICD has holdings in some of the emirate's most high-profile brands, including Emirates, Emaar Properties and lender Emirates NBD.
Istithmar World's investment portfolio spans consumer, industrial and financial services, hotels and commercial property sectors. Among its assets are entertainment group Cirque du Soleil and the Mandarin Oriental hotel in New York.
The investment arm, which made a spate of overseas purchases during the early part of the decade, was hard hit by the global financial crisis as asset values dropped sharply and access to credit dried up.
The firm named veteran banker Ziad Makkawi as its new chief executive in September.