Arab News, Tuesday, Jan 18, 2022 | Jamada Al-Aakhirah 15, 1443
Bahrain’s Infracorp plans $800 million perpetual green sukuk sale
Bahrain:
Bahrain-based Infracorp, an infrastructure fund
spun out of asset manager GFH Financial Group, aims to issue around $800 million
in perpetual green sukuk — Islamic bonds — in the first quarter, GFH’s chief
executive said on Monday.
Infracorp has hired banks to advise on the debt
sale, GFH CEO Hisham Alrayes told Reuters in an interview, but did not name
them. Allen & Overy was hired as legal adviser and KPMG as auditor.
Infracorp’s roughly $1 billion in capital will
come from the sukuk as well as $200 million in equity.
The fund has $3 billion in assets under management
and was spun off to allow Infracorp to focus on infrastructure assets while GFH
mainly looks at financial instruments.
Proceeds from the sukuk sale will be eligible to
finance environment, social and governance (ESG) goals, a focus in the Gulf and
around the world as governments and investors acknowledge the need to curb
emissions and improve corporate governance.
Alrayes said GFH was in talks with strategic and
financial investors to buy a stake in Infracorp, which would initially reduce
its stake in the spun-out company to 40 percent, and eventually dilute GFH’s
share to 20 percent.
Eventually, he said this would “bring down our
ownership and hence de-consolidate it from our book and (Infracorp) becomes one
of our associates.”
GFH last year received approval to issue up to
$300 million in Additional Tier 1 (AT1) sukuk — debt raised by financial
institutions to shore up their core capital, Alrayes said.
GFH could issue between $100 million and $150
million in AT1 sukuk this year, should it need and if market conditions are
right, he added.