Emirates announces USD 550 million sukuk issue

Emirates' debut sukuk issue has Dubai Islamic Bank as Mandated Lead Manager, who also play the role of Joint Book Runner along with HSBC and Standard Chartered Bank. The Joint Lead Managers on the issue are National Bank of Abu Dhabi, UBS Investment Bank and Gulf International Bank. The issue will be initially listed on the Luxembourg Stock Exchange. Institutional investors based in the GCC states and outside can invest in the sukuk.

Riyaz Peermohamed, Emirates senior vice-president Corporate Treasury, said "The bond has been benchmarked at around USD $550 million. It will be issued in June and will be offered to institutional investors in the GCC, as well as in Europe and Asia.

"The money raised from the bond will be used to finance the new Emirates Engineering Centre and its new headquarters building, both currently under construction."

In 2001 Emirates made a successful entry into the regional capital markets with a debut Dirham bond issue, which was oversubscribed more than 2.5 times and closed at AED 1.5 billion. This was the first issue by a UAE corporation and the first bond to be listed on the Dubai Financial Market.

Last year Emirates came back to the markets with an Eurobond issue, listed on the Luxembourg Stock Exchange. It was oversubscribed by 25 per cent and closed at USD $500 million. More than a third of this issue was subscribed by investors outside the GCC region. This was also the largest ever unsecured/unrated bond by an airline.