DUBAI (Reuters) - A detained Saudi billionaire who led the collapsed Saad Group is seeking to repay part of a multi-billion dollar debt to creditors under a deal that could allow his release, people familiar with the matter told Reuters.

The businessman, Maan al-Sanea, was detained in October in the kingdom’s Eastern Province for unpaid debts, and has since been in a civil detention center in the city of Khobar, according to several sources.

Reemas Group, a financial consultancy hired by Saad Group, has outlined a proposed settlement covering $4 billion in debt. In an email sent by Reemas to creditors, of copy of which Reuters has obtained, it suggests that they would get more of their money back than under a court-enforced liquidation of the company, albeit over a longer period.

At the height of his success, al-Sanea held investments in a number of large companies, including a 3.1 percent stake in British-based bank HSBC bought in 2007. That year, when his net worth was estimated at over $10 billion, he was ranked by Forbes as one of the world’s 100 richest men.

But al-Sanea’s fortunes turned in 2009, when his business collapsed under heavy debts, unleashing a series of long-running legal disputes.

Al-Sanea was detained a few weeks before Crown Prince Mohammed bin Salman launched a crackdown on corruption in which dozens of Saudi princes and businessmen are being held.

However, there is no indication that al-Sanea’s case is linked with this campaign, as he was detained by the Saudi authorities for unpaid debts rather than alleged graft.

Sources told Reuters that al-Sanea has access to a telephone to speak to his legal team and advisers, and has been trying to organize the debt settlement with the help of some members of his family.

A source at the Ministry of Justice in Riyadh said al-Sanea could be released if his debts with creditors are settled.

Khobar General Court could not immediately be reached for comment.

Reemas Group, which has branches in Khobar and Bahrain, said in the email that 34 financial institutions had obtained court judgments in the case worth 15.7 billion riyals ($4.19 billion).

“We have contacted 90 percent either directly or via their local representative over the past few days. They have welcomed the idea, and we are yet to receive their preliminary consent in order to proceed with the next step,” said the email, which was sent to other creditors last month.

Reemas said in the email that rather than auctioning off Saad Group’s assets under the liquidation process, they would be moved into a special purpose vehicle, with creditors owning the new company. “The initiative would protect the (assets) from substantial reduction in value and enhance the debt coverage ratio to reach at least 20-25 percent,” it said.

Reemas Group did not immediately respond to a Reuters request for comment.

WEIGHT OF DEBT

Saad Group, once one of the largest business conglomerates in the Gulf, collapsed under the weight of its debts in 2009 along with the family-owned Saudi conglomerate Ahmad Algosaibi and Brothers (AHAB). Since then, the two groups have been battling each other in the courts, with creditors seeking to recover billions of dollars.

AHAB said it had yet to approached about the proposed debt settlement. “We are happy to engage in the dialogue and feel we should be included and if we’re not included we will pursue all avenues available to us,” said Simon Charlton, AHAB’s chief restructuring officer and acting chief executive.

The debt settlement efforts, sources said, came after an entity established by the Supreme Judicial Council in Saudi Arabia, called the Joint Directorate of Enforcement at the General Court in Al-Khobar (JDEK), took over al-Sanea’s personal assets and began a liquidation process for Saad Group.

The proposed settlement suggests creditors would recover the funds over a five-year period. Two sources said that according to the debt recovery path indicated by JDEK, they would get only 6 to 8 cents in the dollar but more quickly, over a period of one to three years.

According to the terms of the settlement, the special purpose vehicle would be supervised by a steering committee headed by Saudi Arabia’s Arab National Bank.

Arab National Bank did not respond to a Reuters request for comment.

Two of the sources familiar with the matter confirmed that a consensual and speedy settlement would show al-Sanea is serious about repaying creditors and could potentially accelerate his release.