Abu Dhabi [15] Oct 2009 Tourism Development & Investment Company (TDIC), developer of major cultural, residential and tourism destinations in Abu Dhabi has issued the largest GCC sukuk in 2009 with its inaugural US$1bn 5-year Reg S Sukuk Al Ijara under a US$1.45bn Global Sukuk Trust Certificate Issuance Programme. This transaction is the first sukuk issuance by a 100% indirect Government of Abu Dhabi owned entity.

His Excellency Sheikh Sultan Bin Tahnoon Al Nahyan, Chairman of TDIC, said: “The remarkable interest in TDIC’s sukuk programme clearly demonstrates the confidence and trust of the international capital markets in the position of Abu Dhabi. We are pleased that we have achieved this great success during the sukuk issuance as this comes shortly after we issued our inaugural bond earlier this year. In line with Abu Dhabi’s 2030 economic plan, TDIC has a long-term strategic vision to support developing Abu Dhabi into a world-class tourism destination.”

With TDIC’s Aa2/AA/AA credit ratings from Moodys, S&P and Fitch, highly experienced management and a unique role within the Abu Dhabi 2030 plan, the TDIC sukuk transaction was extremely well received globally and generated the largest order book for a global sukuk issuance in 2009, with 210 investors placing orders in excess of US$6.7bn.

Lee Tabler, CEO of TDIC, also commented: “TDIC has made a significant impression among global investors. This further reinforces TDIC’s role as a key player in the evolution of Abu Dhabi as it becomes a leading tourism and cultural destination.”

TDIC was able to price the fixed rate sukuk to yield 4.949%, representing a spread of 230bps over 5 year mid-swaps and 20bps tighter than initial price guidance during the roadshow process. In line with TDIC’s strategy of tapping Islamic investors as part of its overall funding base, 60% of the sukuk were allocated to investors in the Middle East, 20% to investors in Asia and 20% to investors in Europe. The investors comprised of banks (48%), asset managers and funds (21%), central banks and agencies (15%), private banks (14%) and 2% to other investors.

Abu Dhabi Commercial Bank, HSBC and Standard Chartered Bank were mandated as Joint Lead Managers/Bookrunners of the transaction and were joined by Co Managers Abu Dhabi Islamic Bank, Dubai Islamic Bank, First Energy Bank, Islamic Development Bank and Qatar Islamic Bank. Allied Investment Partners acted as the General Financial Adviser to TDIC.