Abu Dhabi, UAEThursday 20 February 2020

GFH Group raises $300 million through sukuk issuance

The sukuk’s proceeds will go towards the company’s upcoming growth phase

Dubai Investments listed on Dubai bourse reported a slight increase in its full-year net profit. AFP/Karim Sahib
Dubai Investments listed on Dubai bourse reported a slight increase in its full-year net profit. AFP/Karim Sahib

GFH Financial Group, a Manama and Dubai-listed financial institution, raised $300 million (Dh1.1 billion) through a five-year sukuk or Islamic bond, it said on Wednesday.

The company said the issue was oversubscribed 2.5 times, with the order book exceeding $750m.

“The strong market demand and successful closure of the sukuk reflects market confidence in GFH and was supported by [the bank's] S&P and Fitch ‘B’ rating,” it said in a statement to the Dubai Financial Market, where its shares trade.

The sukuk saw strong participation from international investors who received 48 per cent of the allocation, with the remaining 52 per cent going to regional investors.

"This is another milestone enabling us to tap debt capital markets for the first time since 2008. The strong interest in our sukuk is a result of GFH’s robust fundamentals and strong turnaround in 2016, following a strategic investment made by ADFG," said Hisham Al Rayes, chief executive of GFH Financial Group.

Shuaa Capital, along with other parties, successfully priced and issued GFH’s sukuk.

In the past 12 months, Shuaa has been mandated on several sukuk issuances, including a $135m, dollar-denominated five-year sukuk for Jabal Omar Development Company and a $135m sukuk for The First Group, the investment bank said in a statement.

“For Shuaa, this is another landmark deal that demonstrates the group’s strong investment banking capabilities and experience from having managed similar high-profile capital market transactions,” said Mustafa Kheriba, deputy chief executive and group head of asset management at Shuaa said in a separate statement.

In September, GFH acquired six income-generating healthcare properties in the US worth Dh661m. The deal was completed in partnership with Madison Marquette, a Washington-based real estate developer, which controls a 6 per cent stake in the properties, while GFH and its investors hold 91 per cent.

The Bahrain-headquartered company also plans to invest $200m in the privately-owned schools sector through its new investment platform, Britus Education.

Updated: January 22, 2020 02:20 PM

SHARE

SHARE

Most Popular