Emaar signs new $1 billion financing facility
Dubai, December 19, 2011
Emaar Properties has signed a new Islamic and conventional financing facility amounting to Dh3.6 billion ($1 billion).
The facility was signed with Dubai Islamic Bank, National Bank of Abu Dhabi and Standard Chartered Bank as mandated lead arrangers and bookrunners.
As part of the overall debt management for the company, the drawdown of the facility will convert the company’s debt’s maturity profile from short to longer term. This new facility will also assist in reducing the overall financing cost of Emaar due to the lower pricing achieved compared to existing borrowings.
Of the total facility, 50 per cent is repayable in a bullet repayment after five years, and the rest is amortised over eight years, said the statement.
The pricing on the facility is benchmark plus 350 basis points and is secured by The Dubai Mall. Initially, the facility will be utilised to repay the existing $300 million facility taken in 2010. Subsequent drawn downs will be made in 2012 as required, it said.
Mohamed Alabbar, chairman, Emaar Properties, said that the financing arranged is a further testament to Emaar’s ability to raise long term finance at competitive pricing even in tougher economic conditions.
“Emaar has again been amongst the first to raise an eight-year financing in the regional markets with the assistance of our core partner banks, which reflects the superior value Emaar has created for its stakeholders through its iconic developments.”
He added: “The prevailing financial climate also offers a strong opportunity for forward-looking organisations to strengthen their reserves and structure long-term growth plans.”
Emaar reported a net operating profit of Dh1.249 billion ($340 million) in the first nine months (January to September) of 2011. Revenue for the first nine months of this year reached Dh5.873 billion ($1.599 billion).
The nine-month performance of Emaar was underlined by the sustained growth of its hospitality and leisure and shopping malls and retail subsidiaries, the continued demand for homes and commercial space within its established communities such as Downtown Dubai, and the hand-over of prime real estate assets in international markets, including Turkey, Jordan and Syria.
Emaar is on track to hand over residential projects in Saudi Arabia, among other global markets, shortly. – TradeArabia News Service