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Dubai to raise Dh7b in biggest sukuk sale |
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10.29.2009 |
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Dubai: Dubai will raise about $1.93 billion (Dh7 billion) through the biggest Islamic bond sale from the Gulf region this year as the emirate benefits from rising demand for Sharia-compliant debt, according to two bankers familiar with the sale.
The emirate is seeking to borrow about $1.25 billion with a dollar-denominated, five-year fixed-rate Islamic bond, or sukuk, and Dh2.5 billion from a local currency floating-rate Islamic note, said the bankers who requested anonymity.
Dubai, which yesterday closed its book for the bond sale, attracted about $6.55 billion in orders, they said.
"This is a solid, successful deal that sets the tone for anything Dubai Incorporated wants to do in the future," said Norval Loftus, the head of convertible bonds and sukuk at Matrix Corporate Capital Ltd in London, which oversees $2.5 billion in investments.
The emirate's dollar bond will be priced to yield 370 basis points above the midswap rate, while its dirham note will be priced at the same spread above the three-month Emirates Interbank Offered Rate, according to the bankers.
One basis point is 0.01 percentage point. The final pricing is five basis points less than the official price guidance, the same bankers said.
"The order book shows that Dubai's story is gaining credibility," said Chavan Bhogaita, head of credit research at National Bank of Abu Dhabi PJSC in Abu Dhabi.
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Source:gulfnews.com |
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