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Dubai: The National Central Cooling Company (Tabreed) said yesterday it planned to raise at least $570 million this year in Islamic loans and convertible bonds to help refinance existing debt and expansion.
The company has launched syndication of a Dh1 billion ($272.3 million) loan, Tabreed's chief financial officer Abdullah Al Muhairi said. The 12-year facility is Sharia-compliant and is structured as an ijara, or lease agreement.
Tabreed, which builds cooling and air conditioning systems, will use the funds to partly refinance an existing syndicated loan, he said, adding that HSBC was leading the sale.
Al Muhairi, who joined Tabreed in December, said the company was also planning to sell between $300 to $500 million of convertible Islamic bonds this year, although it had still to be approved at an upcoming general meeting.
Al Muhairi declined to name the bank mandated for the sale.
"This [financing] is especially for overseas and local expansion," Al Muhairi said. "We opened in Kuwait in January and are looking to extend our operations in the GCC and Jordan."
Joint ventures
The funds would also be used for joint-venture firms between Tabreed and Abu Dhabi property developers Sorouh Real Estate and Aldar Properties to provide air conditioning systems for their projects, Muhairi said.
Islamic bonds, also known as sukuk, comply with Islam's ban on the receipt of interest, and are typically based on physical assets which pay a dividend or rent to bondholders.
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