E-mail Article
Printer Friendly
Share Article
Aldar may increase bond issue to $1.5bn
Aldar Properties – the UAE's third-largest property developer by market value – said on Sunday it aimed to sell $1.3 billion of convertible Islamic bonds at 75 to 125 basis points over the five-year U.S. dollar mid-swap rate.
The bonds, maturing in 2011, will be issued by a special purpose vehicle based in Jersey, and holders will have the right to convert them to shares in the company.
The bonds will be exchanged for Aldar shares at 27% to 37% above the average of the stock's volume-weighted average price on each trading day between Sunday and the pricing date, the company said in a statement.
Aldar has said it may increase the sale to $1.5 billion. It has applied to list the bonds on the London stock exchange.
The company began presentations to investors Abu Dhabi on Sunday. Road shows are planned in Dubai, Bahrain, Europe and Asia.
Islamic bonds, called sukuk, are typically backed by physical assets that pay a dividend or rent to bondholders rather than interest, which Islam equates with usury.
Aldar-owned land, worth 120% of the sukuk's value, will back the issue, the company said.
With demand growing among the world's 1.2 billion Muslims for investments that comply with their religious beliefs, Gulf Arab corporate sales of sukuk more than doubled to $4.95 billion in the first half of 2006, compared with the year-earlier period, according to London-based law firm Trowers & Hamlins.
The world's largest convertible Islamic bond was sold by Dubai's Ports, Customs and Free Zone Corp., owner of port operator DP World. The $3.5 billion sukuk, priced a year ago, helped finance DP World's $6.8 billion purchase of British rival P&O.
That was also the world's largest Islamic bond until last month when Dubai property developer Nakheel Group increased the size of its sukuk sale by more than 40% to $3.52 billion to take advantage of demand.
Aldar said in October it planned to raise as much as $4 billion in conventional and Islamic debt to fund projects.
Quick Links(Residental)
Filter by address:
No Comments