Bukhatir Investments Limited Vice Chairman Mr. Salah Abdul Rahman Bukhatir signed a landmark agreement creating the first Investment Agency Sukuk in the Islamic finance market with a value of US$50 million (AED184 million).
Emirates Islamic Bank (EIB) and Liquidity Management Centre B.S.C. (LMC) were mandated as Lead Arrangers for the Islamic finance milestone, which will help support the aggressive expansion and investment activities of the Sharjah-based conglomerate, the Bukhatir Group.
The Sharia’a-compliant Sukuk Al-Wakala Bel-Istithmar is an innovative structure that was launched by structuring advisor LMC and co-lead arranger EIB, offering investors the opportunity to be a part of an investment agency that will be managed by Bukhatir Investments Limited. The Sukuk is a reducing investment with a five-year term issue maturing in 2011 and offering investors a return of 175 basis points over 6-month US$ LIBOR and payable semi-annually.
Commenting during the signing held in Sharjah, Mr. Bukhatir said: “We are delighted to have such overwhelming support for the Sukuk issue, which underscores the market’s confidence in the ongoing expansion and investment plans of the Bukhatir Group. The participation of some of the region’s leading financial institutions shows how significant this issue is in the growing Islamic Finance Market, and we are deeply honoured that we were the first to issue it.”
Added Mr. Ahmed Abbas, CEO of LMC, the Bahrain-based investment banking institution managing the secondary market and short term investment needs of Islamic financial institutions: “We are proud to be jointly arranging the Sukuk Issue with EIB for Bukhatir Group and acting as its Structuring Advisor. This is an important innovation in the Islamic finance market which will leverage the tremendous growth of the market to further increase investment and expansion opportunities.”
Mr. Abdulla Showaiter, General Manager, Emirates Islamic Bank, also speaking on this occasion, commented: “We at EIB are happy to once again lead another successful Sukuk offering for a noted corporate name out of the UAE and are proud to be associated and working with such prominent Islamic financial institutions in underwriting and promoting this Sukuk issue. By managing this issue, EIB confirms its obligation to develop the Islamic Sukuk market and attract more international investment attention to the UAE market.”
In addition to EIB and LMC, the issue is fully underwritten by Dubai Islamic Bank, Emirates Bank International, Bank Muscat International, Gulf Finance House Commercial Bank, and Sharjah Islamic Bank.
