Tabreed Closes Syndication Of $692 Million Loan

Tabreed closes syndication of $692 million loan

ABU DHABI, (Pakistan Point News - 09th Sep, 2020) The National Central Cooling Company, Tabreed, has announced the successful syndication of a landmark term-loan facility, which was pre-funded by HSBC Bank middle East Limited, HSBC, in March 2020, as part of the company’s acquisition funding of an 80 percent stake in Emaar Properties PJSC’s (DFM: Emaar) Downtown Dubai district cooling business.

The $692 million loan has a tenor of five years (until March 2025) and was structured as a multi-tranche syndicated facility with Islamic and conventional tranches (the "Facility").

In addition to financing the acquisition of Tabreed’s stake in the Downtown Dubai district cooling business, the Facility will also support the development of a new state-of-the-art district cooling plant in Downtown Dubai. The cooling scheme currently provides 148,471 refrigeration tonnes, RT, of contracted capacity through a network that distributes chilled water produced in three already existing interconnected district cooling plants.

Bader Al Lamki, Chief Executive Officer at Tabreed, said, "The successful syndication of this loan facility underscores Tabreed’s strong business fundamentals, the solid relationships with our key partnering banks and the confidence the financial markets have in our expansion projects, both in Dubai and across the region.’’ "This syndication demonstrates the strong partnerships we have with all our existing relationship banks who have been key stakeholders of the company over the past several years," added Adel Salem Al Wahedi, Chief Financial Officer at Tabreed.

HSBC and ADIB acted as Joint Underwriters, Bookrunners, Initial Mandated Lead Arrangers as well as Global Facility Agent and Investment Agent, respectively for the Facility. The Facility saw participation from nine banks, with over 40 percent of the deal subscribed to by regional and international banks with strong anchorage by the UAE banking market. Emirates NBD Capital Limited and Samba acted as Mandated Lead Arrangers on the Facility.

Mohammed Al Marzouqi, Managing Director, Head of Abu Dhabi Coverage, Global Banking, HSBC Bank Middle East Limited, said, "This transaction is a major milestone in Tabreed’s growth transformation strategy, successfully executed notwithstanding the unprecedented environment owing to the unforeseen market conditions."

Amir Riad, Global Head of Corporate Finance and Investment Banking at ADIB, said, "The successful syndication of the Facility, against the challenging market backdrop demonstrates our leadership in structuring and executing major syndicated financing for major government-related entities where we can bring in our structuring and product expertise, as well as our strong distribution capabilities, to provide optimal financing solutions and is a testament of our leading capabilities and commitment to our clients."

"We are also pleased that Fitch and Moody’s have recently reaffirmed our credit rating which reflects the view that Tabreed’s credit profile has proved resilient to negative pressures stemming from the current market environment," Al Lamki added.

Following the completion of the Downtown Dubai transaction, Tabreed’s presence in Dubai increased to 278,801 RT and its total capacity increased by 13.5 percent to 1,342,574 RT from 83 plants.