Damac to use $500m sukuk to repay dues, buy lands

Damac to use $500m sukuk to repay dues, buy lands
Damac's CFO Adil Taqi (Photo Credit: Mubasher)
Damac DAMAC 1.32% 2.31 0.03

By: Amr Adel

Dubai – Mubasher: Damac Properties aims to use the proceeds of $500 million sukuk to repay part of an earlier sukuk issuance and buy new land plots, according to the company’s chief financial officer (CFO) Adil Taqi.

The company will repay $197 million out of the total sukuk issued in 2014, with $453 million to be matured in 2019.

The remaining value of the $500 sukuk, which stands at $303 million, will be used to buy a new land in Dubai and another one in Qatar, Taqi added.

Damac Real Estate Development, a wholly owned subsidiary of Damac, listed on Thursday, sukuk worth $500 million on Nasdaq Dubai.

This is the second listing for Damac on Nasdaq Dubai following the listing of $650 million sukuk in April 2014.

The final yield of the new $500 million sukuk stands at 6.25%, to be matured in 2022, the CFO noted.

With the new sukuk issuance, the total amount of sukuk owed by the company reached $1.078 billion, along with private sukuk worth $125 million.

The real estate developer is open to debt market options like loans or sukuk, depending on its need, timing, and pricing, to provide the sufficient funding for its projects.

The company does not plan to apply for big loans; however, it may get $40-50 million to support its liquidity.

Damac plans to reduce its debts to $700 million within the coming three or four years.

Translated by: Julian Nabil

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Source: Mubasher Exclusive