Gulf Navigation looks to issue $250mn sukuk for expansion
The ship builder is also seeking to hire other banks for the sale
Gulf Navigation Holding, a Dubai-based ship builder, has hired First Abu Dhabi Bank to manage a US$250 million sukuk issuance as the company looks to expand, the chief executive officer Juma Buamim said.
Mr Buamim said the company would also hire other banks for the sale, which is scheduled for mid-September. The Islamic bond will be repayable at a profit rate of not more than 10 per cent. Proceeds from the sale of the sukuk will be used to fund asset purchases, said Mr Buamim.
The UAE sold $6.75 billion worth of international sukuk, a third of $18.42bn of conventional bonds issued, according to data provider Dealogic. Nasdaq Dubai, a major hub for sukuk listings, has a total of 63 listings, with a value of $51.4bn, one of the biggest in the world. The listings include sukuk from international companies such as the Islamic Development Bank and government of Indonesia.
Gulf Navigation expects to announce three joint ventures in the third quarter and is currently in talks with local, international companies in offshore oil and ship repair services, he said.
The joint ventures will help create a new maritime cluster to serve the region's oil and gas industry. At the same time, Gulf Navigation is seeking to enhance niche services to customers in Abu Dhabi, Khorfakkan.
Outside the UAE, the company is focusing on growth in South-East Asia, India and the Mena region, while also looking at expanding the company's fleet size to 20 ships by 2020, twice its existing fleet. That will help the company boost revenue growth by 300 per cent in 2021.
On the question of Qatar, Mr Buamim said the fallout from the spat is negligible for his company.
No one at Gulf Navigation or First Abu Dhabi Bank was immediately available to comment.
Updated: July 10, 2017 06:56 PM