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Drake & Scull International $120 Million Private Placement Sukuk

DSIs-Facility
2014-11-17 by Hafiz M. Ahmed

DSIs-FacilityDrake & Scull International (DSI) has announced the issuance of a $120 million unrated senior unsecured five-year certificates by way of private placement. The five-year Sukuk structured under the Shari’ah principle of Murabaha, represents the first Sukuk based on Murabaha trades of Shari’ah-compliant certificates on the NASDAQ Dubai Murabaha Platform. The Sukuk will be due on 12 November 2019 and redeemed fully at maturity.

DSI mandated Emirates NBD Capital and Mashreq (via its Islamic banking arm Mashreq Al-Islami) as Joint Coordinators on the deal while also acting as Joint Lead Managers with Al Hilal Bank and Noor Bank who were legally advised by international law firm King & Spalding. DSI was legally advised by Simmons & Simmons in connection with the issue.

Mukhtar Safi, Chief Financial Officer of DSI, said ,“The success of this transaction reflects the market confidence in DSI and is another endorsement to our long standing relations with leading international and regional banks and financial institutions. The substantial interest shown in the five-year Sukuk underlines the strong trust in DSI’s resilient growth plans and regional prospects.

“Our backlog stands at AED 15.3 billion record high as of 30 September 2014. Over the past five years, our backlog grew exponentially at 28.8 per cent compound annual growth rate (CAGR) while maintaining the same capital structure. The Sukuk transaction is instrumental in improving our capital efficiency to deliver our growing backlog and to cater to our growth trajectory in the GCC, MENA and Asian markets.

“The proceeds of the transaction will be mainly used to capitalize our businesses in our leading market in the KSA and in our emerging markets such as India and Egypt. We will be also be targeting a small-cap acquisition to complement our Oil & Gas division in the GCC as well as refinancing part of our short term borrowings on the balance sheet.

“We have set out clear risk management guidelines to monitor and maintain our leverage ratios and we are quite comfortable with the financial covenants required to ensure seamless operations   and a balanced capital structure to cater for our working capital requirements.”

Originally published on www.cpifinancial.net

Author

  • Hafiz M. Ahmed

    Hafiz Maqsood Ahmed is the Editor-in-Chief of The Halal Times, with over 30 years of experience in journalism. Specializing in the Islamic economy, his insightful analyses shape discourse in the global Halal economy.

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