Emirates Sukuk Nets US$824 Million

10th Jun 2005

Emirates’ Chairman HH Sheikh Ahmed Bin Saeed
Al-Maktoum, announced today that the debut Islamic Sukuk issue for the
airline received subscriptions of $824 million against an initial target of
$550 million, oversubscribed by about 50%.  The order book has been closed
at US$550 million. The issue will be a Floating Rate Note (FRN) with a tenure of seven years
and will pay a return to investors of 0.75 per cent over six months USD
Libor. The issue will be listed in Luxembourg. This is the first-ever Islamic sukuk issue by an airline and also the first
ever sukuk with a term of seven years, with the principal proceeds being
paid on maturity.

The response to the issue has been extremely positive and Emirates has been
able to achieve a wide geographical spread of investors, with over 40% from
Europe /Asia and around half from outside the United Arab Emirates. The Mandated Lead Manager of the issue was Dubai Islamic Bank who were also
Joint Book Runners along with HSBC and Standard Chartered Bank. The Joint
Lead Managers on the issue were National Bank of Abu Dhabi, Gulf
International Bank and UBS Investment Bank.


The size and pricing of the issue have been finalised as a consequence of a
book-building exercise undertaken alongside a series of roadshows and
investor presentations made in the GCC by senior members of the Emirates
Management team.



Sheikh Ahmed said: “Even though we have received an over subscription on the
sukuk, Emirates has closed the book at US$550 million as indicated during
the road shows. We are gratified by the investors’ response to our first
sukuk offer, which testifies to their confidence in Emirates’ financial
performance. It is evident that our consistent profitability and sound
management are recognised.”


On behalf of the Mandated Lead Manager, Saad Abdul Razak, Chief Executive
Officer of Dubai Islamic Bank, said: “We congratulate the management of
Emirates in their vision and commitment in bringing the airline to yet
another new source of funding.”


The proceeds of the Islamic Sukuk Bonds issue will be used to finance
Emirates’ new Engineering Centre, now under construction at a cost of Dhs1.3
billion, for completion early in 2006, and the new Emirates Group
headquarters, estimated to cost Dhs700 million and expected to be
inaugurated by the end of next year.


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