APICORP seals SR1 billion murabaha facility with Al-Rajhi

Updated 28 April 2014
0

APICORP seals SR1 billion murabaha facility with Al-Rajhi

Arab Petroleum Investments Corporation (APICORP), the multilateral development bank of the 10-member states of the Organization of Arab Petroleum Exporting Countries (OAPEC), announced that it has successfully closed a five-year SR1 billion ($267 million) bilateral Shariah-compliant facility from Al-Rajhi Bank, Saudi Arabia’s major Islamic bank on competitive market terms.
The deal was led by the financial institutions team of Al-Rajhi Bank.
The facility is aimed at retaining and increasing APICORP’s medium-term funding. Al-Rajhi Bank was the sole murabaha facility arranger, lender and agent.
Ahmad bin Hamad Al-Nuaimi, CEO and general manager of APICORP, said: “We are very delighted with our long association with Al-Rajhi Bank, the strongest and largest Islamic financial institution in the region, which has actively supported and participated in APICORP’s all recent major Islamic fund raising deals.
This loan reiterates APICORP’s track record as a benchmark institution to deal with the banking community and endorses Al-Rajhi’s commitment to APICORP’s mission in financing oil-related infrastructural development needs of the Kingdom and the region.”
Suliman bin Abdulaziz Azzabin, CEO of Al-Rajhi Bank, welcomed the successful closing of the murabaha financing deal.
“We are immensely proud once again to be part of APICORP’s fund raising program and the transaction demonstrates the strengthening ties between the two premier institutions in Saudi Arabia,” he said.
“We look forward to working more closely with APICORP as they execute their growth strategy in the coming years,” he added.
APICORP is a multilateral development bank headquartered in Alkhobar/Dammam, in the Eastern Province to foster the development of the Arab world’s oil and gas industries.
The organization was created under the terms of an agreement signed by the 10-member states of the Organization of Arab Petroleum Exporting Countries (OAPEC) in September 1974.
APICORP enjoys a foreign currency issuer rating of Aa3 for long-term debt and Prime-1 for its short-term debt with stable outlook from Moody’s Investors Service.
Al-Rajhi Bank, established in 1987, is claimed to be the largest retail bank in Saudi Arabia and the largest Islamic bank in the world with total assets of SR279 billion ($74.4 billion) and total shareholders’ equity of SR38.4 billion ($10.2 billion) as at end of Dec. 31, 2013.
Al-Rajhi Bank has worldwide presence with a branch network of 500 branches across the Kingdom and 28 globally in addition to a sophisticated network of 3,644 automated teller machines (ATMs).


UAE regulators ask corporates to declare exposure to Abraaj

Updated 25 min 19 sec ago
0

UAE regulators ask corporates to declare exposure to Abraaj

  • Air Arabia admits $336 million exposure to Abraaj funds.
  • Abraaj sells its Latam, Sub-Saharan Africa, North Africa and Turkey Funds to Colony Capital.

DUBAI: The United Arab Emirates’ top securities regulator has asked UAE-listed companies to declare their exposure to Dubai-based private equity firm Abraaj, which filed for provisional liquidation last week.
The Securities & Commodities Authority sent a letter earlier this week and companies had until Thursday to submit their responses, Obaid Al-Zaabi, chief executive of the regulator, told Reuters.
Air Arabia, a Dubai-listed low-cost carrier, said this week that it had a $336 million exposure to Abraaj, which is the Middle East’s biggest private equity firm. Shares in the airline plunged because of these links.
Al-Zaabi said some companies in the UAE had exposure to Abraaj, without naming them.
A court in the Cayman Islands, where Abraaj Holdings is registered, ordered this week that PwC be appointed as provisional liquidators of the company and Deloitte as liquidators of Abraaj Investment Management Ltd.
Abraaj said that the latest restructuring agreement has received in-principle regulatory approval and is expected to close upon approval from the Cayman Islands court and other customary consents.
On Thursday, the Dubai Financial Services Authority (DFSA), which is the regulator of the Dubai International Financial Center (DIFC), said it would discuss “various matters” with the liquidators and “will continue to work toward safeguarding the interests of investors.”
The DFSA is involved because Abraaj has an entity regulated in DIFC.
Abraaj Group agreed to sell its Latin America, Sub-Saharan Africa, North Africa and Turkey Funds management business to US investment management firm Colony Capital Inc, the companies said on Thursday.
The sale agreement comes after months of turmoil at Abraaj in the wake of its dispute with four of its investors, including the Bill & Melinda Gates Foundation and International Finance Corp. (IFC), over the use of their money in a $1 billion health care fund. The group has denied it misused the funds.
The sale is part of a provisional liquidation and restructuring as set out in a court order. Financial terms of the deal were not disclosed.
Colony Capital has also agreed to oversee, on an interim basis, other Abraaj group funds that are not being acquired so that the group and all its stakeholders have a “comprehensive global solution in place,” the companies said.
The other group funds include the $1 billion health care fund, and some legacy funds of the private equity group.
Sources told Reuters earlier that US buyout firm TPG was in talks with investors in Abraaj’s health care fund to take over management of the assets of the $1 billion fund.
The K-Electric asset, which is being sold in Pakistan and is owned by Abraaj Holdings, is also not part of the transaction.
Colony’s deal comes after other investors such as Cerberus Capital Management had also made offers for the Abraaj business before it filed for provisional liquidation in the Cayman Islands.
A unit of Abu Dhabi Financial Group earlier this week made a conditional offer to buy Abraaj’s management interest in all of its limited partnerships for $50 million, according to a document seen by Reuters.
Since Abraaj’s row with some investors became public early this year, it split its investment management business and holding company, while its founder Arif Naqvi stepped aside from the day-to-day running of its private equity fund unit and the firm halted its investment activities.
Tom Barrack, executive chairman of Colony Capital, said that he hoped that the transaction would enable the process of rebuilding on all sides and also bring an end to the speculation that has swirled around Abraaj over the past months.