DUBAI (Bloomberg) - Dubai may sell stakes in some companies to the public to reduce debt as the Persian Gulf emirate alters loan terms and restructures two of its main investment groups, Dubai World and Dubai Holding LLC.

“We are working on opening up the capital of leading companies to our public,” Sheikh Ahmed bin Saeed Al Maktoum, chairman of the Dubai Supreme Fiscal Committee, told a conference in the emirate yesterday. The sheikhdom needs to “regroup, review and reconsider some of our investments and re- challenge our competitive edge”, he said. The committee is the top decision-making body for Dubai’s financial affairs.

Dubai and its state-controlled companies are struggling to repay debt that Barclays Capital estimated in September at about $112 billion. The second-largest of seven sheikhdoms that make up the United Arab Emirates roiled global markets last year when Dubai World sought to freeze payments on $24.9 billion of loans. Dubai World’s creditors have since agreed to a restructuring plan, a person familiar with the matter said in October.

Dubai allowed property to be sold to foreigners in some parts of the emirate in 2002, triggering a building boom and a quadrupling of home prices until mid-2008. The credit crunch, which drove away speculators and squeezed mortgage lending, caused home prices to plunge by more than half.

“There might be a privatisation plan, which is something that we are working on with the government,” Mohammed Ibrahim al-Shaibani, director-general of the Dubai ruler’s court and CEO of the Investment Corp. of Dubai, said at the conference, adding there would be no fire sales. The government is evaluating such a plan and may use it as a “mechanism of reducing some of our debt,” he said.

ICD, the third of the main state-controlled holding companies, owns stakes in companies including Emirates, the world’s biggest airline by international passengers, Emirates National Oil Co., Dubai Aluminium Co. and stock-market operator Borse Dubai Ltd. Companies owned by ICD had a market value of 73.7 billion dirhams ($20 billion) at the end of December last year, according to a government bond prospectus issued in September.

A share sale by Emirates “may be a reality one day, not now”, Mr. al-Shaibani said. “Dubai is very rich in good quality assets and we have been chased by so many friends, bankers and investment bankers to really do something with our assets.”

The government is reviewing options in one company and may announce a stake sale in the “near future”, Mr. al-Shaibani said.

Dubai shares fell to the lowest in more than two months, with the Dubai Financial Market’s DFM General Index dropping 1.4 percent to 1,659.5 at the 2pm close.