The Dubai-owned airline Emirates said Wednesday, June 13, it would raise 750 million dirhams ($205.4 million) through a five-year domestic bond issue to help fund its ambitious expansion plans.
The bond will be lead managed and underwritten by HSBC Bank Middle East, National Bank of Abu Dhabi, Emirates Bank Group and the National Bank of Dubai, and listed on the fledgling Dubai Financial Market (DFM), Emirates chairman Sheikh Ahmad bin Saeed al-Maktoum said.
It is the airline's first venture into the bond market and marks a first for the DFM, Sheikh Ahmad said.
The bond has a minimum subscription of five million dirhams ($1.3 million), with interest paid twice yearly at a rate of 70 basis points over six-month EBOR (Emirates InterBank Offered Rate).
”We have launched the bond issue in response to demand from the investment community in the UAE," Sheikh Ahmad said. "It offers investors the opportunity to be associated with the future growth of Emirates."
"There is always a need to widen our funding base and develop a number of different financing resources as we gear up for future expansion. The launch of this bond represents an important diversification of funding for Emirates."
Emirates, a launch customer for the Airbus 380 superjumbo, has around four billion dollars in aircraft on order and has said it aims to have as many as 210 planes operational by 2010.
The massive increase was announced after Dubai's crown prince, Sheikh Mohammad bin Rashid al-Maktoum, projected a six fold increase in tourism to the Gulf emirate within the next decade.
The airline saw a 19.8 percent jump in passengers in 2000 to 5.7 million and a 24.2 percent increase in cargo to 335,194 tons. — (AFP)
© Agence France Presse
© 2001 Mena Report (www.menareport.com)