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Burjeel Holdings made its debt market debut with a USD 500 mn sukuk that drew more than USD 1.6 bn in orders, according to a press release (pdf). The heavy demand gave the UAE healthcare provider ample room to tighten pricing, securing one of the lowest five-year funding costs achieved by a GCC-based private non-investment grade corporate issuer in recent years.
Good things come to those who wait: The issuance, which the firm had delayed back in April as the war widened spreads, was oversubscribed 3.2x, with international investors taking the lion’s share, accounting for 61% of the final allocation.
The sukuk — Burjeel’s first public debt issuance and the first offering from a MENA healthcare company since 2018 — was priced at a 7% profit-rate and a yield of 7.125%, tightened from initial guidance in the mid-7% range. Proceeds will be used to refinance existing debt and support the company’s broader growth agenda as it expands its healthcare platform across the region. It was rated BB+ by S&P Global Ratings and Ba2 by Moody’s.
The transaction also marks the first UAE corporate bond or sukuk issuance since the recent bout of regional geopolitical tensions. Regional issuance reached 11.2 bn in May, as we’ve previously reported, while investment-grade spreads have largely tightened back to pre-war levels. Recent issuances by UAE lenders, including First Abu Dhabi Bank (FAB), Mashreq, and Emirates NBD, suggest investor appetite for regional credit remains intact.
ADVISORS- Citi, Emirates NBD Capital, and FAB were global coordinators, joined by bookrunners Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Dubai Islamic Bank, RAKBANK, and Sharjah Islamic Bank. Emirates NBD Capital and FAB also served as structuring banks.
