Dana Gas boosts Sukuk to $1 billion
Posted: 22 October 2007
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Dana Gas, Middle East ’s first regional private-sector natural gas company, has announced that its convertible bond, or Sukuk offering, has been further increased by $125 million to $1 billion.
It is the second increase from the initial issue size of $750 million following continuing strong demand, primarily from international investors.
JPMorgan acted as sole Bookrunner and Lead Manager on the Offering while Barclays Capital and Citi are acting as Joint Lead Managers on the Offering.
Hamid Jafar, Executive Chairman of Dana Gas, said: “We are delighted by the continued enthusiasm for our Sukuk offering which has encouraged us to increase the size of our issue for a second time. This clearly demonstrates the strength of international investor support for Dana Gas’s business and strategy, and for its unique position in the fast-growing Middle Eastern gas sector.”
Dana Gas has issued its innovative Sukuk as part of its strategy to put in place the most optimal structure to fund its rapid growth and expansion in the natural gas business sector.
Worldwide Islamic banking assets currently total around $500 billion and are growing at over 15% per annum, with Islamic banks and financial institutions managing over $ 250 billion of assets and a further $200 to $300 billion managed by the Islamic subsidiaries of international banks.
Dana Gas’s Sukuk is the first major accelerated convertible bond to be issued in the Middle East . These Sukuk are the most sophisticated equity-linked structures to be issued in the region, due to their unique features combining a forward-start pricing structure and delayed settlement within a Shariah compliant instrument. The issue of the convertible Sukuk offering was approved by the Company’s shareholders at an Extraordinary General Meeting held in July 2007.
Structured as a Sukuk al-Mudarabah, the Dana Gas Sukuk matures in 2012 and has a fixed profit rate of 7.5%. The reference share price, to which an exchange premium of 10% will apply, will be set in 9 months' time, reflecting the management’s confidence in the company’s near-term future growth.
The Sukuk closing is expected by 31 October 2007 . Post-closing it is intended that the bonds shall be traded on the Professional Securities Market of London Stock Exchange in London .
Dana Gas is currently active in all aspects of the rapidly growing natural gas business in several countries across the Region, with major projects and operations in the UAE, Egypt and most recently in the Kurdistan Region of Iraq, as well as new projects under development in other countries in the Middle East/North Africa/South Asia Region.
The company’s 1.1 billion acquisition of Centurion Energy earlier this year placed Dana Gas as the sixth largest gas producer in Egypt , with further subsequent gas discoveries made as part of an active exploration programme.
In April, Dana Gas also concluded agreements for gas projects with the Kurdistan Regional Government of Iraq, with a first phase investment of approximately $400 million. |
