Ma­zoon Elec­tric­ity is­sues de­but Sukuk cer­tifi­cates

Muscat Daily - - BUSINESS -

Mus­cat - Ma­zoon Elec­tric­ity Com­pany on Novem­ber 1 suc­cess­fully priced its de­but Reg S/144A US$500mn ten-year Sukuk of­fer­ing.

The Sharia’a-com­pli­ant Ijara struc­ture was adopted for is­sue of the Sukuk cer­tifi­cates and the profit rate was set 5.2 per cent, ac­cord­ing to a press re­lease is­sued by Nama Group.

The is­suance is rated Baa2 (neg­a­tive) by Moody’s In­vestor Ser­vice and BBB (neg­a­tive) by Fitch Rat­ings.

The cer­tifi­cates are listed on the Ir­ish Stock Ex­change. The is­suance was man­aged by Ma­zoon Elec­tric­ity Com­pany and Nama Hold­ing along with JP Mor­gan Se­cu­ri­ties plc, Bank Mus­cat, KFH Cap­i­tal In­vest­ment and First Abu Dhabi Bank act­ing as joint lead man­agers and Noor Bank and Warba Bank act­ing as co-man­agers.

Com­ment­ing on this milestone, H E Has­san bin Mo­hammed al Lawati, chair­man of Nama Group, said, “Since 2014, the group’s fi­nanc­ing pro­gramme – La­mar project has so far achieved fi­nanc­ing RO1.4bn up to date. The fundrais­ing pro­gramme will sup­port the group’s elec­tric­ity trans­mis­sion and dis­tri­bu­tion net­works in­vest­ments.”

This land­mark trans­ac­tion marks the first in­ter­na­tional cor­po­rate Sukuk is­sue out of Oman, and the first Reg S/144A cor­po­rate Sukuk out of the Mid­dle East and North Africa (MENA) re­gion since May 2016. Ro­bust in­vestor de­mand trans­lated into a fi­nal or­der-book of ap­prox­i­mately US$5bn from 300 or­ders, rep­re­sent­ing more than ten times over­sub­scrip­tion.

The fi­nal or­der­book dis­tri­bu­tion by ge­og­ra­phy com­prised of 47 per cent from the MENA re­gion, 17 per cent Asian in­vestors, 23 per cent Euro­pean in­vestors and 13 per cent US in­vestors.

A com­pre­hen­sive global road­show was con­ducted in Asia, UAE, Lon­don, Bos­ton and New York. With this mar­ket­ing ef­fort, Ma­zoon Elec­tric­ity was able to build strong mo­men­tum and price the ten-year Sukuk of­fer­ing via an in­tra-day ex­e­cu­tion process.

“We at­tribute the suc­cess of the Sukuk cer­tifi­cate is­sue pri­mar­ily to the pre­vail­ing trans­par­ent, ro­bust and suc­cess­ful reg­u­la­tory mech­a­nism, sup­port of the gov­ern­ment and con­sis­tent growth of the com­pany,” said the chief ex­ec­u­tive of­fi­cer Eng Zahir Ab­dulla al Abri.

The group chief fi­nan­cial of­fi­cer of the Nama Group, Hus­sain Ab­dul­latif al Balushi, said, “It was a re­mark­able suc­cess of Ma­zoon Elec­tric­ity’s de­but Sukuk is­suance. Ro­bust de­mand from in­ter­na­tional and Is­lamic in­vestors prompted Ma­zoon Elec­tric­ity to tighten pric­ing from price guid­ance to reach the profit rate of 5.2 per cent.”

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