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Mon 11 Jun 2007 12:14 AM

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$1bn demand for IIG Islamic bonds

Kuwait's International Investment Group says investor response 'very strong.'

International Investment Group (IIG), a Kuwait-based company with interests including property, said investors offered more than $1 billion for $200 million of convertible Islamic bonds it sold last month.

"The investor response was very strong, with 65 accounts putting orders for a total aggregate demand exceeding $1 billion," the sharia-compliant investment company said in a statement on Sunday.

"Strong demand has allowed IIG to increase the transaction size from the planned $150 million to $200 million, and price the issue at the tight end of the initial price guidance," it said.

Holders have the right to convert their bonds into IIG shares at a premium of 45 % to their average value during the book building period, the sale's arranger, Barclays, told Reuters on May 30.

That is when the bonds were priced at a fixed rate of 6.75 %, equivalent to 150 basis points over mid-swaps, IIG said in the statement.

Shares of IIG's were trading at 385 fils ($1.34) at 0906 GMT. There are 1,000 fils to the dinar.

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