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DP World’s $1.2b sukuk gets strong response

|By Arabian Post Staff| DP World’s new $1.2 billion 7-year sukuk received strong investor interest and was two times oversubscribed receiving more than $2 billion in bids, the company announced.

The new sukuk was priced at a fixed coupon rate of 3.91% maturing in 2023, replacing over $1.1bn of the 2017 6.25% coupon sukuk.

The new sukuk issue followed DP World’s successful refinancing of over $1.1 billion of the existing $1.5 billion 2017 sukuk. The remaining $387 million 2017 sukuk matures next year and was at the time the largest and first 10 year sukuk done in the region. Similarly the current tender offer is the first of its kind for the region. The money raised from the new sukuk sale will fund the tender offer along with general corporate purposes.

According to DP World Group Chairman, the company took advantage of attractive market conditions to successfully to execute the first tender offer in the region.  The issue will be listed  on Nasdaq Dubai, the largest sukuk market globally with over 50 listings worth $40billion.

The new sukuk will keep the dual listing on the London Stock Exchange reflecting the same listing arrangements as the old issuance, in line with the tender offer. The settlement of the tender, as well as the new issue, will take place on 31 May 2016.

For the twelve months ending December 31, 2015, DP World reported a 31 per cent year-on-year increase in net profit to $883 million.  The company is rated Baa3 (stable) by Moody’s and BBB- (positive) by Fitch.