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Dubai’s Damac mandates banks for $500m sukuk issue

City, Cityscape, Urban Supplied
The ultra-luxurious Cavalli Couture complex is Damac's most recent launch

Dubai-based Damac Real Estate Limited (Damac) has mandated banks to arrange investor meetings before a potential three-year benchmark US dollar-denominated sukuk worth at least $500 million.

Investor calls and meetings were set to begin on Thursday and run to April 17, Reuters reported, citing a document from one of the mandated banks.

Deutsche Bank, Emirates NBD Capital and J.P. Morgan are mandated joint global coordinators.

UAE lenders Abu Dhabi Commercial Bank, Dubai Islamic Bank and Mashreq were designated as joint bookrunners on the deal.

Damac was contacted by AGBI but declined to comment.

The developer reported a profit of AED1.4 billion ($381 million) for 2022, with total assets of AED21.6 billion.

Damac delisted from the Dubai Financial Market last year after submitting a request to do so in 2021.

In March, credit rating agency Moody’s Investors Service said that improved fiscal positions of energy-exporting issuers such as Saudi Arabia will help stabilise long-term sovereign sukuk issuance at nearly $80 billion in 2023 and $80 billion to $85 billion in 2024.

In addition, Fitch Ratings said that the global sukuk issuance is building up for the second quarter despite short-term uncertainties amid continued macro volatilities.

However, sukuk issuance from core markets fell to $45.3 billion in Q1 2023, down 18.5 percent quarter-on-quarter.

Islamic investor’s liquidity and investment appetite continue to support the longer-term sukuk story, said Bashar Al-Natoor, global head of Islamic Finance at Fitch.

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