Dubai: The Dubai government announced on Sunday it has secured $3 billion (Dh11 billion) in credit facilities to finance the expansion of Dubai’s two airports — Dubai International and Al Maktoum International (DWC).
A statement from the Dubai Media Office said the credit facilities signify the first stage of a larger funding programme that will turn DWC into the emirate’s primary airport, serving up to 146 million passengers by 2025.
The deal comprises a $1.6 billion, seven-year conventional loan, and a $1.48 billion equivalent, seven-year ijara dominated in dirhams. Ijara is a common lease-based structure used in Islamic finance.
HSBC acted as the financial adviser on the deal.
Shaikh Ahmad Bin Saeed Al Maktoum, President of Dubai Civil Aviation and Chairman and CEO of Emirates airline and Group, in his capacity as chairman of Dubai’s Supreme Fiscal Committee, stated that Dubai remains committed to the development of DWC and the growth of the aviation sector.
Joint mandated lead arrangers
Dubai International is currently one of the world’s largest airports, with 84.5 million passengers using the airport as of December 31, 2016. The new Al Maktoum International is planned to become the primary airport for Dubai as well as home to Emirates airline starting 2025.
The financing was raised by Department of Finance for the Government of Dubai, the Investment Corporation of Dubai, and Dubai Aviation City Corporation.
Twelve international and local banks acted as joint mandated lead arrangers and joint bookrunners including Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Bank of China, Citibank, Dubai Islamic Bank, First Abu Dhabi Bank, HSBC, Industrial and Commercial Bank of China Limited, Intesa Sanpaolo, JP Morgan, Noor Bank and Standard Chartered.
The facilities were oversubscribed by more than 50 per cent.