The NBB Group, that consists of Bahrain Islamic Bank and National Bank of Bahrain, has revealed the closing an Ijara facility for Oman-based Mazoon Electricity Company (MZEC), with the duo acting as the sole arranging, structuring and bookrunning banks on the facility.
The debut Islamic financing deal by the Oman-based GRE was signed for an amount of $235 million. The proceeds will be used to finance the capital expenditure plans of MZEC for 2021, mainly comprising investments in the electricity distribution and supply network in its license area in Oman.
The facility is created as a two-year ijara bridge facility marking the first Islamic bank facility for Nama Group that has in the past raised several conventional bank loan facilities and issuances in the debt capital markets under RegS and 144a format, including a 10-year $500 million debut Sukuk in 2017.
The facility got interest from the regional banks of Kuwait, Bahrain and UAE with twelve financial partners participating in the deal and an oversubscribed order book.
“The NBB Group is delighted to advise and arrange financing for strategically important transactions such as the electricity distribution and supply sector in Oman. The success of a debut Islamic facility by Mazoon Electricity paves the way to attract capital from Islamic financiers for critical infrastructure,” NBB Group CEO (Corporate & Institutional Investment Banking) Hisham AlKurdi said while commenting on the achievement.
“As the national bank of the Kingdom of Bahrain, NBB Group views Oman as one of its key markets and is proud to be associated with Mazoon Electricity and Nama Holding on this transaction,” he stated.
The deal arrives as part of the countless efforts of the NBB Group to evolve its offerings and activities, that target Bahraini and GCC’s strategic clients, he added.
“The inaugural Islamic financing facility is a milestone transaction for the group, thus adding new banking relationships to the group and providing it access to Islamic financiers of the region to fund the investment in electricity distribution infrastructure of the sultanate,” Mazoon Electricity CEO Salim Said Al Kamyani said.
Mazoon electricity’s owner is the Oman government that created a holding company for the electricity and water sector, Nama Holding; which is owned by the sultanate’s sovereign wealth fund Oman Investment Authority.
Nama Chief Financial Officer Ahmed Tufail has voiced his delight at the backing of the group received from the Islamic financiers for this transaction.
“It reinforces the confidence placed by a broad array of capital providers in the transparent and robust regulatory framework of the electricity sector of Oman and its strong credit fundamentals,” he added.
Source: Trade Arabia