gif Investment Sukuk Country Issuer
Closing Date
Qatar Global Sukuk
Qatar
Qatar govern- ment
October 2003
Due Date Value
Sukuk structure
October 2010
US$700 million
Sukuk Al-Ijara
Structure features
The Government, as the issuer, signed a Master Ijara Agreement, pledging to hold assets (mainly land) and rights upon trust on behalf of the sukuk holders, on a pro rata basis according to the face value of the sukuk held by each subscriber. Since April 2004, every April and October, the Issuer has made a periodic distribu- tion to the sukuk holders.
CBB Sukuk
Bahrain Central Bank of Bahrain
Monthly
Every 182 days
Varies between approx. BD5
million- BD10 million
Sukuk Al-Ijara Sukuk Al- Salam
CBB issues both Al-Ijara and Al-Salam on a monthly basis. Sukuk Al-Ijara consists of CBB buying and leasing assets to the subscribers through sukuk. The sukuk represents the individual beneficial rights/ownership held by CBB on behalf of the subscrib- ers. Sukuk Al-Salam is issued by CBB with the aim of mobilising Salam capital so that goods to be delivered on the basis of the Salam contract come to the ownership of the sukuk holders. CBB acts as the seller of the goods of Salam, whilst the subscribers buy the goods; the funds realised from subscription are the purchase price (Salam capital) of the goods. The sukuk holders own the Salam goods and entitled to the sale price of the sukuk.
Emirates Airlines Sukuk
MT Venus Glory Sukuk/Al Safeena Sukuk
Dubai Civil Aviation Authority Sukuk
Al
Marfa’a Al Mali Sukuk
UAE
Emirates Airlines
UAE Al
Safeena Ltd
July 2005 July 2010 US$550 million
April 2005 April 2010 US$26 million
Musharaka Emirates Airlines, as an existing business, uses musharaka sukuk to mobilise funds on the basis of partnership contracts. The sukuk holders are the owners of the issuer’s assets on a pro rata basis.
Sukuk-Al- Ijara
The structure of this deal is similar to the Al-Ijara issuances de- scribed above, with the ship Venus Glory as the underlying asset.
UAE
Dubai Civil Aviation Authority
Bahrain The
Bahrain Financial Harbour Holding Company
Dubai World Sukuk
UAE
Nakheel PJSC
November 2004
November 2009
US$1 billion sukuk
July 2005 July 2010 US$1.34 million
Musharaka This is another existing entity that used musharaka sukuk to mobilise funds as described in the above example of Emirates Airlines.
Istisna’a- Ijara Sukuk
In this arrangement, the funds from the sukuk issue are being used to pay for construction of the Bahrain Financial Harbour development. The issuer transferred existing assets to the Special Purpose Vehicle (SPV), which then leased them back to the company pursuant to an ijara lease agreement. The ijara lease periodic rentals from these assets are paid to the SPV and are then distributed to the sukuk holders. Basically, the SPV holds the assets on trust for the sukuk holders.
December 2006
December 2009
US$3.52 billion
Sukuk Al- Ijara
The transaction was structured as a 3 year Pre-QPO Equity Linked Sukuk al-Ijara wherein funds were raised at the Nakheel Holdings 1 (obligor) level. Under a purchase agreement, certain pre-iden- tified assets were sold to Nakheel Development Limited - an off- shore Issuer SPV that was formulated as a free zone company in the Jebel Ali Free Zone. The SPV issued sukuk worth US$3.52 billion in order to purchase assets from Nakheel Holdings 1. The purchased assets were subsequently leased by the SPV to Nakheel Holdings 2 for a period of 3 years,
DP World Sukuk
UAE
Dubai Ports World
July 2007 July 2017 US$1.5 billion
Unsecured Mudaraba
DP World created DP World Sukuk as a limited liability company to facilitate the issuance; the two entities then entered into a purchase and sale undertaking and mudaraba (joint partnership investment) agreement, mainly in relation to the development of the container terminal 2 facility at DP World’s principal Jebel Ali port in Dubai. Trust certificate holders benefit from a declaration of trust over DP World Sukuk’s interest in the mudaraba assets. They also benefit from various rights, title, and benefits under the sukuk transaction documents. Under the mudaraba agreement, DP World Sukuk will receive 99% of profits generated from the mudaraba assets and will use this revenue to pay periodic distri- bution amounts to certificate holders.
20 Global Islamic Finance October 2010
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