Arada successfully closes $50mn second tap of sukuk
The recent tap issue follows exceptional investor feedback and enquiries as fund value passes $450mn
Sharjah-based developer Arada has successfully closed a $50mn second tap of its existing $450mn sukuk, which was issued last June and listed on the London Stock Exchange.
The five-year tap is the UAE developer’s third approach to the capital markets in the last nine months and the investor re-offer yield was posted at 8.488%. Mashreq acted as sole manager and bookrunner for the second tap.
Group CEO Ahmed Alkhoshaibi said, “We’re extremely happy to have achieved a size of $500mn on our inaugural sukuk via the last two tap transactions. This achievement is testament to the fact that investors have been tracking our story since May last year, and have begun to appreciate and acknowledge our investor proposition, good governance record and credit strength. We’re especially pleased to have reached the benchmark size of this instrument, which will further enhance the liquidity and trading of our paper. I’d also like to put on record our thanks to Mashreq as the sole arranger on this tap, and for being part of all three transactions in our debut issuance.”
In early January 2023, Arada said it had completed work on the $190.5m Nest in Aljada and, late in the month, the developer said it awarded a $129mn contract for the Vida Aljada Hotel Complex to GAC.
Arada’s second tap follows a first tap executed in October 2022 for $100mn. At that time, the group is said to have received an exceptional response from international debt capital markets, which led to an oversubscribed transaction with orders of $185mn.
As part of Arada’s continuing investor engagement and interaction – more recently via extensive roadshows across the UK and GCC before the October tap – this recent tap issue was executed on the back of investor feedback and enquiries, the firm said.
Arada’s existing five-year fixed rate RegS debut Sukuk issuance was rated BB- by Fitch and B1 by Moody’s.
In early February 2023, Arada reported a 46% rise in sales in 2022 to reach $955.5mn.
