Dewa loan syndication closed

LOAN CLOSED: State-owned utility Dubai Electricity and Water Authority (Dewa) has closed syndication of its $2 billion, one-year Islamic loan. (Getty Images)

State-owned utility Dubai Electricity and Water Authority (Dewa) has closed syndication of its $2 billion, one-year Islamic loan via arranging banks ABN Amro, Dubai Islamic Bank investment arm Millennium Capital and Standard Chartered, a banking source said on Thursday.

The loan raised the full $2 billion in the first, or senior, phase of syndication, and as a result the deal will not be sold down any further in a general syndication, the banker added.

The facility, which will be used for expansion, is guaranteed by the government of Dubai and pays a margin of 30 basis points.

In the senior phase, relationship banks of the borrower were invited to join the deal as mandated lead arrangers. They were asked to commit $200 million or AED equivalent for an upfront fee of 20 bps.

The loan complies with Islam's ban on interest and is structured as an Ijara, or lease agreement. (Reuters)

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