UAE’s Majid Al Futtaim markets 'green' Islamic bonds

Dubai: Majid Al Futtaim, a UAE-based developer and shopping mall operator, has started marketing ten-year US dollar-denominated “green” Islamic bonds, or sukuk, at about 245 basis points over mid-swaps, a document showed on Tuesday.

The proceeds of the sukuk will back environmentally-friendly projects in areas such as renewable energy and sustainable water management, according to the document drawn up by one of the banks leading the deal.

Green bonds are a growing category of fixed-income securities and green sukuk could widen the appeal of sukuk beyond its traditional markets in Asia and the Middle East to include ethical investors in Western countries.

Majid Al Futtaim’s paper will be of benchmark size, which generally means over $500 million (Dh1.84 billion), and is expected to price later on Tuesday, according to the document.

HSBC and Standard Chartered have been hired as global coordinators for the planned deal, and they are working as bookrunners along with Abu Dhabi Islamic Bank, Dubai Islamic Bank, ENBD Capital, First Abu Dhabi Bank, and Gulf International Bank.