Emirates Airline 2025 Sukuk

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By TESTCustomwebLP TESTCustomwebLP March 30, 2015 12:46

Emirates Airline 2025 Sukuk

Emirates launched its much-touted amortizing Sukuk last week, which is guaranteed by UK Export Finance. The US$913,026,000 Certificates due 2025 were issued by Khadrawy Limited. The deal is being distributed today.

The proceeds will be used to fund the acquisition of four Airbus A380-800 aircraft, which are expected to be delivered in April, May, June and July 2015.
The issuance of the Certificates, in the principal amount of US$913,026,000 with a tenor of 10 years, marks the world’s first Sukuk financing supported by UKEF and the largest ever capital markets offering in the aviation space with an Export Credit Agency guarantee. The transaction also represents the first time that a Sukuk has been used to pre-fund the acquisition of aircraft and the first ever Sukuk financing for A380 aircraft.

“Emirates has always taken a diversified risk approach to our aircraft financing. Together with our bank partners and ECAs (UKEF, Coface and Euler Hermes), we continually look for solid and innovative opportunities in the global market to finance our growing aircraft fleet, and we are very pleased with the tremendous response to this landmark transaction,” said Nirmal Govindadas, Emirates Senior VP, Corporate Treasury.

Following a focused marketing effort commencing on March 16, 2015, the Certificates, to be issued pursuant to Regulation S and Rule 144A under the United States Securities Act of 1933, were priced on 25 March 2015 at a profit rate of 2.471% (90 basis points over mid swaps). The Certificates saw strong demand from global investors, attracting orders exceeding US$3.2 billion and recording an oversubscription of 3.6 times.

The deal attracted interest from a diverse group of conventional and Islamic investors. The Certificates were allocated to over 45 global institutional investors, with approximately 39% of the Certificates distributed to the Middle East and Asia, 32% to Europe and 29% to the United States. By investor type, approximately 47% were distributed to fund managers, 38% to banks and 15% to insurance companies and pension funds.

Govindadas added: “The strong and diversified investor demand for the offering is a testament to investor confidence in the strength of the Emirates franchise.”

The Certificates are expected to be issued tomorrow and admitted to listing and trading on the regulated market of the London Stock Exchange and on NASDAQ Dubai.

Citigroup, HSBC, JPMorgan and National Bank of Abu Dhabi acted as Joint Structuring Agents and Joint Lead Managers. Abu Dhabi Islamic Bank, Dubai Islamic Bank, Emirates NBD and Standard Chartered acted as Joint Lead Managers and NCB Capital Company acted as Co-Lead Manager.

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By TESTCustomwebLP TESTCustomwebLP March 30, 2015 12:46