Emirates to sell $1bn amortising sukuk
Dubai, March 12, 2013
Emirates airline, Dubai's flagship carrier, launched a $1 billion amortising Islamic bond on Tuesday at the tighter end of pricing guidance, suggesting healthy demand for the deal.
The 10-year sukuk, maturing 2023, carries a weighted average life of five years and launched at a spread of 300 basis points over five year midswaps, arranging banks said.
The deal launched at the tighter end of profit rate guidance released earlier and lead managers had said in an update that order books were oversubscribed, including strong anchor orders from regional investors.
Demand could have been spurred by the guidance which investors considered to be generous. The issue was already trading up in grey, or unofficial, trading, market sources said.
Emirates tapped global debt markets in January for a $750 million amortising bond, which received a muted response due to weak market sentiment at the time.
The 4.5 percent 2025 paper was bid just below par at 99.8 cents on the dollar on Tuesday to yield about 4.5 percent, according to Thomson Reuters data.
Given that the new amortiser has a two-year shorter duration, bankers had expected it to price tighter than the conventional paper.
Citigroup, Standard Chartered, Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Dubai Islamic Bank and ENBD Capital are mandated lead managers for the sukuk. - Reuters