Dubai Islamic sells $ 750m of Islamic bonds


The bank, the third largest Gulf Arab Islamic lender by market value, priced the five-year bonds at 33 basis points over three-month dollar Libor, after previously giving a price guidance of 33 to 36 points.



No-one at the bank was immediately available for comment.



Barclays, Standard Chartered and Citigroup managed the issue, rated A1 by Moody’s and A by Standard and Poor’s. Dubai Islamic marketed the Islamic bond, or sukuk, issue to investors in the Middle East, Asia and Europe. Sukuk are typically backed by physical assets that pay a dividend or rent to bondholders rather than interest, which Islam equates with usury.



Surging demand among the world’s 1.2 billion Muslims for investments that comply with their religious beliefs led Dubai property developer Nakheel to increase a bond last year by 40 per cent to $ 3.52bn, making it the largest ever sold.



Dubai Islamic said in November it was in talks to arrange the sale of about $ 10bn of Islamic bonds for companies, including some from the West looking to tap Gulf Arab oil wealth.



The lender also said that month it planned to open branches in Saudi Arabia and Qatar as part of an expansion plan to more than double its branch network to 100 by mid-2008.



Mobily launched its services on May 25, 2005, and in less than a year since then, its customers have reached 3.8 million and more than six million by 2006, beating the record in the Middle East and North Africa.



Today, Mobily network is spread across all cities and major towns. This is in addition to more than a 22,000-kilometer highway covered by Mobily’s independent coverage.



Mobily also launched 3.5G services on June 27, 2006, covering 19 cities in the Kingdom. By the end of 2006, Mobily had more than 500,000 active subscribers in the 3G and 3.5G, thus claiming to be the biggest 3G mobile operator in the Middle East.



In terms of services, Mobily has been leading in introducing new services and innovative packages in the Kingdom such as MMS, LBS, international roaming for prepaid SIM cards in addition to GPRS and GPRS EDGE roaming, as well as other services. Mobily’s workforce exceeds 2,700 employees, with 82 percent of them from Saudi Arabia and was the first to introduce female sales outlets in the telecom sector.



Alseghyer expressed his gratitude to the banks for their response to his company’s proposal and assured to work hard to install the state of the art telecom technology in the Kingdom. Al-Kaf referred to the creativity of Mobily not only in services and products, but also in financing which has adopted new methods of lending based on Islamic laws.


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