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Saturday, 31 May 2014

Saudi’s Alhokair plans debut sukuk, loan to fund expansion

Dubai: Saudi Arabian retailer Fawaz Abdul Aziz Alhokair Co plans to issue a debut riyal-denominated sukuk and is close to signing a 1 billion riyal ($266.6 million) loan, it said on Tuesday, to help fund expansion.
Alhokair, the Saudi Arabian retailer which franchises brands such as Zara and Marks and Spencer in the kingdom, will begin meeting local investors on Tuesday ahead of a potential issuing of the Islamic bond, a bourse filing said.
Samba Financial Group’s investment banking arm will arrange the transaction, although no value or tenor of the sukuk was given in the statement.
The company was also close to signing an agreement with a group of banks for a loan worth 1 billion riyals, Alhokair said in a separate stock market statement.
The loan would be used to repay most of its existing loans and also to finance the company’s expansion.
To cover the time between the loan and the sukuk being completed, Alhokair had signed a 315 million riyal bridging loan with Samba, the statement said.
Alhokair operates across 20 markets, predominantly in the Middle East and Commonwealth of Independent States, and has been expanding both on its own and through acquisitions - including the purchase of Spanish clothing brand Blanco earlier this year.
Alhokair was planning to open 404 stores globally in the next financial year, of which half would be in Saudi Arabia, a company official told Reuters in March.
Saudi Arabia’s retail market is highly regarded by investors and companies, given its favourable demographics — about 60 per cent of the population is under 30 — and its growing per capita income.
(Gulf News.Com / 27 May 2014)
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Indonesia prepares Islamic finance road map

Indonesia’s capital market regulator is preparing a five-year road map for Islamic finance to expand the industry in Southeast Asia’s largest economy.
The plan will help boost the number of Islamic capital market products and expand the industry’s investor base, the Financial Services Authority (OJK) said in a statement.
The OJK added that it was seeking market input for the road map and would set up discussion groups with stakeholders, including the central bank, the Finance Ministry, the Indonesian Stock Exchange (IDX) and the country’s national sharia board.
It also said it was refining rules for the issuance of Islamic securities, which it expected to be completed this year. These would include details on the settlement of Islamic financial transactions, disclosure requirements for sukuk (Islamic bonds) and guidelines for sukuk trustees, Bloomberg reported.
Indonesia has 11 Islamic banks and 23 Islamic windows operated by conventional banks. Their combined Islamic banking assets grew 24 percent to Rp 242 trillion (US$20.8 billion) last year, giving the sector a 4.9 percent share of total banking assets, OJK data shows.
Last month, the OJK said it would implement risk management guidelines for Islamic insurance companies and that it was now a full member of the Malaysia-based Islamic Financial Services Board, a major standard-setting body of the industry.
The OJK took over the supervision of banks, brokerages and insurance firms from the central bank and Capital Market and Financial Institution Supervisory Agency (Bapepam-LK) in January this year.
(Jakarta Post / 30 May 2014)
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