Arada raises $50m via second tap of existing $450m sukuk

Arada has successfully completed the second tap of its $450 million sukuk, which was issued in June 2022 and listed on the London Stock Exchange. The second tap raised $50 million and brings the total size of the sukuk to $500 million.

This is the developer’s third foray into the capital markets in the last nine months and the investor reoffer yield was 8.448 per cent. In October 2022, Arada raised $100 million in a first tap which received an overwhelming response from the international debt capital market, resulting in an oversubscribed transaction with orders worth $185 million. The second tap was executed based on investor feedback and inquiries, following extensive roadshows across the UK and GCC.

Mashreq acted as the sole Manager and Bookrunner for the second tap. Ahmed Alkhoshaibi, Group CEO of Arada, expressed his satisfaction with the outcome, saying, “We are thrilled to have raised $500 million through the two tap transactions on our inaugural sukuk. This demonstrates that investors have been following our story since May 2022 and recognise our investor proposition, good governance record, and credit strength.”

The five-year fixed rate RegS debut sukuk was rated BB- by Fitch and B1 by Moody’s and the proceeds from the sukuk will be used for general corporate purposes and to support Arada’s ongoing projects. In May 2022, Moody’s and Fitch assigned Arada its first-ever credit ratings, B1 and B+ respectively, both with a stable outlook.