Emirates NBD has announced that it has successfully priced Air Lease Corporation’s (ALC) $600M sukuk, making it the first Islamic bond issued by a US corporation. ALC is one of the world’s biggest aircraft leasing companies and has raised over $20B through the bond market, with a net book value of $24.
The demand for the sukuk was strong, resulting in orders exceeding $2.2B, enabling ALC to increase the offering to $600M. The profit rate was reduced by 30 basis points to 5.85% at a spread of 185 basis points over US treasuries due to the robust order book. The sukuk adheres to the latest shari’ah standards, and 80% of the allocation was given to Middle Eastern investors.
The offering was priced flat to its existing conventional curve, attracting high-quality institutional investors outside the US and diversifying ALC’s investor pool, according to TradeArabia. ALC Executive VPt & Chief Financial Officer Greg Willis said: “As the first North American corporate sukuk offering, we are excited to demonstrate the depth and strength of liquidity in the Middle East market.”
“The transaction is a testament to ALC’s broad access to capital, and we look forward to expanding our funding footprint in this region. The quality and breadth of demand for the transaction exceeded our expectations, and we are thankful to our banking partners, investors and advisors for their support in achieving this outcome,” he noted.
Emirates NBD Capital CEO Mohammad Al Bastaki said: “We are proud to have supported the successful pricing of ALC’s inaugural sukuk, marking the first time a US-based corporation has issued a benchmark sukuk.”
“The robust over-subscription and the participation of high-quality institutional investors from the Middle East will support ALC’s efforts to diversify its investor base and reflects the high demand for shari’ah-compliant issues outside the region. We expect this milestone issue will incentivise other non-regional issuers to consider sukuk issuances,” he added.
