Emirates floats $1b bond issue

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One of the Arab world’s largest carriers, the Emirates, announced the successful close of its US dollar “Reg S” bond issue at $1 billion and has picked four banks for a possible dollar bond issue. Government-owned Emirates has chosen Deutsche Bank AG, Emirates NBD PJSC, HSBC Holdings Plc and Morgan Stanley as joint lead managers for the sale. With a five-year maturity term, the unrated issue will carry a coupon of 5.125% per annum fixed, payable semi-annually.

Emirates can confirm the appointment of the joint lead managers and our intention to go on a road show, with a view to launching a bond if market conditions, including pricing, are favourable, the company said on Thursday in an e-mailed statement.

“We are testing the waters to see if something like this would work,” Emirates president Tim Clark said.

“It is an ongoing process and we do it all the time. There is no certainty whether or not a bond will be issued this year.”

“This issue from Emirates has received an overwhelmingly positive response from a wide range of investors, which is indicative of our financial strength. This also shows a high level of confidence in our successful business model and growth plans,” said Shaikh Ahmad Bin Saeed Al Maktoum, Chairman of Dubai Civil Aviation and Chairman and Chief Executive of Emirates airline and Group.

Emirates is Dubai’s flagship company and one of the biggest contributors to a local economy hit hard by a property crisis.

 

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