Trowers & Hamlins advises on debut Oman sukuk
Muscat, July 1, 2013
International law firm Trowers & Hamlins said it had advised Oman-based Tilal Development Company (Tilal) on the first-ever corporate sukuk issue in the Sultanate.
The sukuk received regulatory approval from Oman's Capital Market Authority last week and the private placement for the five-year RO50 million ($129.4 million) sukuk is on track to close in July, said a statement from the law firm.
Tilal is the underlying obligor in the sukuk structure and the sukuk will be issued by a special purpose vehicle, Modern Sukuk Company.
The proceeds of the sukuk will go towards repaying the existing debts of Tilal and expanding the Muscat Grand Mall. The sukuk has been rated BBB+ by Capital Intelligence, will pay a five per cent profit rate, and will use an ijarah structure.
Salman Ahmed, the partner and head of Islamic finance Mena at Trowers & Hamlins, said: "We are delighted to have played a key part in this landmark transaction in Oman. This transaction brought together several of our market-leading practices in the Middle East to address complex issues arising in the absence of Sukuk law being in place."
"This is a very significant achievement for Tilal and could not have been achieved without the assistance and guidance of the CMA. We are certain this would pave the way for other issuers to enter the sukuk market in Oman very soon," he added.
Mohsin Shaik Sehu Mohamed, the head of Islamic finance at Al Madina Investment, the lead arranger for the transaction, said: "We are very pleased to have received approval for this sukuk, and we already have two more Omani sukuk in the pipeline."
"We are seeing Omani domestic investors, including pension funds and insurance firms, express interest in the sukuk and we believe it could have a broader regional appeal, in particular from Qatar," he added.-TradeArabia News Service