SHARJAH, 22 October 2007 — Dana Gas PJSC, Middle East’s first regional private-sector natural gas company, said yesterday that its convertible sukuk offering, launched on Oct. 4, 2007, has been further increased by $125 million to $1 billion due to strong demand. This is the second increase from the initial issue of $750 million.
The sukuk closing is expected by Oct. 31, 2007. Post-closing it is intended that the bonds shall be traded on the professional securities market of London Stock Exchange in London.
Structured as a Sukuk Al-Mudarabah, the Dana Gas sukuk matures in 2012 and has a fixed profit rate of 7.5 percent. The reference share price, to which an exchange premium of 10 percent will apply, will be set in 9 months’ time, reflecting the management’s confidence in the company’s near-term future growth.
JPMorgan acted as sole bookrunner and lead manager on the offering. Barclays Capital and Citi are joint lead managers on the offering, the company said in a statement.
Hamid Jafar, executive chairman of Dana Gas, said: “We are delighted by the continued enthusiasm for our sukuk offering which has encouraged us to increase the size of our issue for a second time. This clearly demonstrates the strength of international investor support for Dana Gas’s business and strategy, and for its unique position in the fast-growing Middle Eastern gas sector.”
Dana Gas has issued its innovative sukuk as part of its strategy to put in place the most optimal structure to fund its rapid growth and expansion in the natural gas business sector.
Worldwide Islamic banking assets currently total around $500 billion and are growing at over 15 percent per annum, with Islamic banks and financial institutions managing over $250 billion of assets and a further $200 to $300 billion managed by the Islamic subsidiaries of international banks.
Dana Gas’s sukuk is the first major accelerated convertible bond to be issued in the Middle East. These sukuk are the most sophisticated equity-linked structures to be issued in the region, due to their unique features combining a forward-start pricing structure and delayed settlement within a Shariah-compliant instrument. Dana Gas has major projects and operations in the UAE, Egypt and most recently in the Kurdistan Region of Iraq as well as new projects in other countries in the Middle East/North Africa/South Asia Region.