|By TAP Staff|Goldman Sachs is meeting investors this week for the sale of a dollar-denominated, benchmark-sized sukuk issue through its unit JANY Sukuk Co., people with knowledge of the deal said.
The New York-based lender’s first foray into the Islamic capital markets three years ago ended without a sale amid criticism from scholars about the structure of its sukuk program and the use of funds raised. This time the planned security will be a Sukuk al Wakala, where one party entrusts another to act on its behalf.
Goldman Sachs established a $2 billion program in 2011 based on a so-called commodity murabaha structure, or a cost plus mark-up transaction. The program, blessed by eight of the world’s top Islamic scholars, became entangled in a debate on whether it met Shariah-compliant guidelines because it didn’t ensure debt was traded at par, and it didn’t clarify how it planned to use the funds raised.
This time Goldman Sachs along with Abu Dhabi Islamic Bank, National Bank of Abu Dhabi PJSC, Emirates NBD Capital Ltd. and NCB Capital will manage the new offering, the people said. It plans to meet investors in the Middle East for two days starting Sept. 10.
About $72 billion of sukuk have been sold globally in the year through yesterday, compared with $80 billion in the same period in 2013, according to data compiled by Bloomberg.
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