Ras Al Khaimah completes $1bn sukuk issuance
RIYADH, 5 days ago
The Government of Ras Al Khaimah, acting through the emirate's Investment and Development Office, successfully closed its offering of a 10-year $1 billion senior unsecured sukuk at a profit rate of 5.01%.
The RAK government tapped the international debt capital market after 10 years and the issuance of the sukuk was completed yesterday (March 5) under the Government of Ras Al Khaimah’s $2 billion Trust Certificate Issuance Programme which was signed on February 28, 2025 (the Programme).
The sukuk was issued under the Programme by RAK Capital, a special purpose vehicle affiliated with the Government of Ras Al Khaimah.
The issuance follows S&P Global Ratings’ affirmation of its ‘A’ rating and Fitch’s affirmation of its ‘A+’ rating on RAK Capital’s sukuk programme, which is in line with the credit agencies’ ratings for the Government of Ras Al Khaimah.
The sukuk is consistent with the most recent Shari’a developments, as promulgated by the UAE Central Bank Higher Shari’a Authority, with the sale of the ijara assets being an enforceable sale with a specific exemption by decree for registration of the real estate ijara assets.
In this manner, the Government of Ras Al Khaimah has adhered to the most Shari’a-compliant structure.
The Government of Ras Al Khaimah announced the issuance on March 3, 2025 and conducted virtual roadshows to meet multiple investors from across the globe, including Asia, the GCC, Europe and the UK.
Following the successful roadshow, RAK Capital priced the transaction on March 5, 2025 while listing the sukuk on the Nasdaq Dubai.
The transaction was launched at an Initial Pricing Guidance of 10-year US Treasury plus 120 bps. Strong investor demand and an orderbook of over $4.4 billion enabled the Government of Ras Al Khaimah to compress the final pricing by 40 bps to 10-year US Treasury plus 80 bps.
The issuance was subscribed by global investors including 57.8% from Mena, 35% from the UK/continental Europe and 7.2% from Asia/Others.
Citi and Emirates NBD Capital acted as Structuring Advisors, while Abu Dhabi Commercial Bank, Citi, Emirates NBD Capital, First Abu Dhabi Bank, RAKBANK and Standard Chartered Bank acted as Joint Global Coordinators.-TradeArabia News Service
