EIIB-Rasmala, a leading asset management and financing group, announced the first closing of its Rasmala Leasing Fund 2, with a target of $125 million in capital commitments.

The launch of the fund follows significant investor appetite for Rasmala Leasing Fund 1 and will offer investors the same stable, low-risk and attractive return profile through a diversified portfolio of Sharia’a-compliant, asset-backed equipment leases with predominately US-domiciled high quality corporate credit lessees, a statement said.

The Fund targets an IRR of 6 per cent to 7 per cent, net of fees and expenses, and a minimum targeted annual cash distribution of approximately 8.5 per cent.

The Fund focuses on low-obsolescence equipment leases, including a variety of long-life items such as rail, manufacturing, material handling, mining, construction, logging, machine tools and trailers.

Leasing is the largest single form of commercial finance for equipment in the US. Both 2013 and 2014 were successively record years for the equipment financing market in the US, and investment in equipment is expected to grow 5 per cent in 2015, according to the Q3 update of the 2015 Equipment Leasing & Finance U.S. Economic Outlook recently released by the Equipment Leasing & Finance Foundation.

Eric Swats, head of Asset Management at EIIB-Rasmala said: “The Rasmala Leasing Fund 1, which closed for commitments in March 2015, has been a success with over $60 million in capital contributions and investments.”

“It has already distributed $7.41 million back to investors as of August 1, 2015. In response to the success of this initial fund, the positive feedback we received from investors, and on the basis of the income generating and overall return potential from equipment leasing, we launched the Rasmala Leasing Fund 2.

“Today, we are delighted to announce its initial closing, achieving another key milestone in the evolution of Rasmala’s alternative investments,” he added. – TradeArabia News Service