Following a recent declaration of a 750 million Emirati dirham ($205.4 million) bonds issuance, the Chief Executive of the Dubai Aviation Authority, Sheikh Ahmed Bin Said Al-Maktoom announced that the company will double the amount to 1.5 billion dirhams ($408.3 million), reports AFP new agency on Monday, July 3.
The bond issue is meant to finance various corporate financial projects in the Emirates’expansion plan, which was announced by Dubai's crown prince following the projected sixfold increase in tourism to the Gulf emirate within the next decade.
The five-year bond will pay interest twice a year at a rate of 70 basis points over the six-month EBOR (Emirates InterBank Offered Rate), and have already been made available for exchanges on the Dubai Financial Market. The Emirates Airlines Corporation has become the first association in the UAE to use bonds as a means of obtaining direct funding from investors.
The issuance will be managed and underwritten by HSBC Bank Middle East, National Bank of Abu Dhabi, Emirates Bank Group and the National Bank of Dubai. Ahmad added that co-managers will include ABN Amro, Barclays Capital, Citibank N.A., Credit Agricole Indosuez, Lloyds TSB and Standard Chartered Bank.
Emirates, with a current fleet of 35 planes, has on order aircraf worth approximately $4 billion and plans to have as many as 210 planes operational by 2010. The airline saw an increase in demand of 20 percent last year, with 5.7 million passengers, and a 24 percent increase in cargo to 335,194 tons. — (MENA Report)
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