Dubai contractor Drake eyes $122m sukuk to enhance ops
Sukuk issuance plan follows the company's recent restructuring and recapitalisation efforts
Contracting giant Drake & Scull International has announced plans to issue a sukuk convertible into equity during the second quarter of 2018.
The company's board approved plans for the issuance of convertible sukuk with an indicative value of at least AED450 million ($122.5 million).
DSI said in a statement that the sukuk follows the company's restructuring and recapitalization efforts and will be converted to shares over a maximum period of 5 years, at a price of AED3 per share or at a discount of 25 percent of the market price of the share, to be determined at the time of conversion.
The sukuk issuance is subject to regulatory and shareholders’ approval at the company’s upcoming General Assembly meeting, which is scheduled to convene next month.
Rabih Abou Diwan, investor relations director, Drake & Scull International, said: “The sukuk issuance comes within the framework of the strategic plan approved by the board of directors of the company, as a succession of the restructuring and recapitalization efforts implemented to secure the required funding for the ongoing and future projects portfolio in the region.
“The key objective is diversification of our financing and the sukuk offers a sharia compliant platform that is appealing and reassuring to a larger spectrum of investors, and most importantly to our shareholders.”
He added that the proceeds of the sukuk will be used "to enhance the operational capacity of the group".
In January, the Dubai-based contracting giant announced that it has successfully completed the restructuring of its corporate general bank debt in the UAE.
The company said that it has also secured new credit lines and working capital facilities for its ongoing and new projects portfolio.
Courtesy Arabian Business