Business | Banking

Apicorp raises billions in Sharia-compliant syndicated financing

The facility is aimed at retaining and increasing its medium term funding

  • By Babu Das Augustine, Deputy Business Editor
  • Published: 13:15 February 13, 2012
  • Gulf News

Dubai: Arab Petroleum Investments Corporation (Apicorp), the multilateral development bank of the ten member states of the Organization of Arab Petroleum Exporting Countries (OAPEC), on Monday announced it has successfully closed a three-year 2.5 billion-riyal ($667 million) syndicated Sharia-compliant facility from four leading Saudi Arabian banks on competitive market terms. 

The facility, which is Apicorp's debut syndicated Sharia-compliant financing, is aimed at retaining and increasing its medium term funding. The government of UAE has a 17 per cent stake in Apicorp. 

Leading Saudi banks Riyad Bank, Al Rajhi Bank, Banque Saudi Fransi and The Saudi British Bank acted as the mandated lead arrangers for the facility, while Riyad Bank will perform the role of Murabaha facility agent. The term financing was oversubscribed by the lead arrangers. 

"This transaction- -a continuation of Apicorp's strategy to significantly strengthen its balance sheet; a strategy first announced in October 2010 when Apicorp debuted its three times oversubscribed Saudi Arabian Riyal 2 billion bond," said Ahmad Bin Hamad Al Nuaimi, chief executive and general manager of Apicorp. 

Apicorp doubled its authorized capital to $2.4 billion, increased its paid up capital by 36 per cent to $750 million, and increased its subscribed capital by 173 per cent to $1.5 billion.

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