Firm to gain as Gulf business hub spends
A unit of the company, which holds stakes in businesses from real estate to glass, wraped up investor meetings in Singapore on Wednesday before the sale of about
The yield to call on GEMS Education's perpetual sukuk, the last Islamic bond sold in Dubai, fell 154 basis points since its sale in November to 9.8 per cent.
The company has set price guidance on the notes at about 300 basis points above mid-swaps, according to a person familiar with the matter who asked not to be identified because the information is private. The yield on Dubai's dollar-denominated Islamic bonds due 2023 fell 42 basis points, or 0.42 of a percentage point, this year to 4.31 per cent on Tuesday, according to data compiled by
Standard & Poor's rated
More than 80 per cent of the sukuk proceeds are earmarked for refinancing debt, Kalban said. The rest will be invested in the company's 23-square kilometer industrial, commercial and residential complex.
Hussain said the possibility of a dividend payout to the parent from sukuk proceeds could be a hurdle for a successful sale.
"While they obviously will give priority to the operational business at the park level, it would have been nice" to have a restriction on payments to the parent, he added.
"It comes down to pricing. Given the slight weakness of the structure, investors need to feel compensated," he said.
Dubai Investments Park's parent company has no debt, said Kalban, so the sukuk proceeds will be used to settle liabilities and for investment at the unit.
Dubai's economy is set to grow 4.6 per cent, on average, between 2012 and 2015, more than twice as fast as in the prior four years, government forecasts show.
The emirate won the right to host the Expo on
"There is a recovery in real estate, especially in that area near the Expo site,"
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