Saudi CPC wins $150m Islamic funding
Jeddah, May 7, 2013
Construction Products Holding Company (CPC), the industrial arm of Saudi Binladin Group (SBG) has secured a $150 million Murabaha facility from Standard Chartered in a transaction rated by world-renowned finance magazine, The Asset, as “The best structured trade finance deal in Saudi Arabia”.
The Shariah compliant term financing is allocated to CPC for Rental Equipment Limited (REL), a 98 per cent-owned subsidiary of CPC, said a statement from the company.
The transaction augments CPC’s capital structure with central funding for a broad range of strategic initiatives and allows for multiple and flexible use, ensuring permanent working capital and debt optimization through scheduled funding for term requirements.
Commenting on the deal, CPC chairman Saleh Binladen said, “This transaction is a landmark development in Murabaha financing and gives us the leeway to maximize our strategic initiatives while strengthening our capital base.”
Mu’taz Sawwaf, the CEO of CPC described the deal as “Innovatively structured and a major step for the business as it allows us great flexibility to move forward with our growth strategy.”
Aleem Khan, Standard Chartered managing director and regional head of structured trade finance and financing solutions for Mena and Americas, said: “This transaction is an ideal example of our approach to providing our clients with holistic solutions that cater their specific financial needs. The deal provides CPC with a comprehensive financial solution which packages both corporate finance and financial markets services in a Shariah-compliant product.”
“We are glad the transaction was recognized with this prestigious award,” Khan said. “This is testament to the unique aspects of this deal’s structure and comes as recognition to our continuous efforts to provide our clients with world class financial solutions,” he added.
In August 2011, Standard Chartered Private Equity (SCPE) acquired a minority stake in CPC through an equity investment of $ 75 million. This was the first investment in Saudi Arabia SCPE.-TradeArabia News Service