Dubai's Damac raises $650mn through sukuk

Company receives offers for up to $2.7bn of cash

The Damac Towers by Paramount project under consutruction in Dubai's Business Bay area.
The Damac Towers by Paramount project under consutruction in Dubai's Business Bay area.

Dubai-based property developer Damac has raised $650mn via the issue of a new five-year sukuk, or islamic bond.

The company, which raised almost $400mn for founder Hussain Sajwani when it floated 14.3% of its shares on the London Stock Exchange in December, said that its order book for the fundraising was four-times oversubscribed. It will pay a coupon of 4.97% on the money raised.

Damac said the money would be used "for general corporate purposes and the acquisition of land plots to strengthen and extend the company's development pipeline".

Sajwani, who is the company's executive chairman, said: "The success of this offering, which has been heavily oversubscribed, is another strong endorsement of the market's confidence in Damac and its growth plans."

He added that it "allows us to further diversify our investor base and improve capital efficiency, in line with our tight risk management practices".

The company appointed Barclays, Citigroup, and Deutsche Bank as joint global co-ordinators, as well as Abu Dhabi Islamic Bank, Dubai Islamic Bank, Emirates NBD Capital and National Bank of Abu Dhabi as joint lead managers.

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