Issuance by Aldar Investments will be used to refinance existing debt held by the Abu Dhabi developer
Aldar Properties has announced that its 100 percent owned subsidiary Aldar Investments has successfully issued its debut fixed rate US dollar denominated sukuk, with a tenor of 7 years, raising a total of $500 million.
The developer said the new issuance demonstrates Aldar Investments’ ability to raise efficient long-term debt capital independently and also successfully refinances Aldar’s forthcoming debt maturities.
The proceeds of the sukuk issuance will be used to refinance existing Aldar debt.
It added in a statement that the new sukuk, the first to be issued by an Abu Dhabi corporate entity since 2013, benefited from strong regional Islamic demand as well as international institutional interest which enabled the issue to be more than twice oversubscribed.
Combined with the group’s bank facilities, the debut sukuk extends overall debt maturity beyond 5 years at an average interest rate of 3.9 percent, demonstrating the strength and resilience of Aldar’s balance sheet, the statement said.
Greg Fewer, chief financial officer, said: "This successful sukuk issuance is a strong result for Aldar and validates the rationale for establishing Aldar Investments. We want Aldar Investments to be the most cost-effective platform for real estate ownership in the region and this transaction moves us significantly towards that goal."