Dubai Islamic Bank backs Union Properties with refinancing facility

Dubai Islamic Bank (DIB), the largest Islamic bank in the UAE, will provide property developer Union Properties with an AED360 million Islamic re-financing facility to help it manage its balance sheet and enhance the focus on its core business. The developer has been moving forward with expansion plans after repaying AED7 billion worth of legacy bank debt.

Source: Union Properties website.

DIB CEO Dr Adnan Chilwan said: “The real estate sector in the UAE has rebounded strongly on the back of the economy’s core fundamentals. The current and planned infrastructure of Dubai and the UAE positions the country amongst the most attractive markets in the world for business growth and prosperity. The expatriate population has seen a significant rise over the recent past as the nation relentlessly progresses towards establishing itself as the hub for regional and global names. With key regulations in place and optimum enforcement of the same by relevant authorities, the industry is now on a solid and sustainable growth path. 

"Given the current scenario, quality names like Union Properties are uniquely positioned to capitalise on the opportunities that Dubai and UAE represent, and DIB with its rich heritage, expertise and highly liquid balance sheet, is the ideal partner for such strategic names.”

Real estate transactions in the UAE have grown at a rapid pace since 2012, with the volume of deals in Dubai increasing by about 50% over the past year – excluding remortgages and donations – according to Dubai’s Real Estate Regulatory Agency. Standards & Poor’s suggests that prices in the sector will continue to remain stable and will be backed by the strong macroeconomic growth in the UAE, the DIB noted.

Union Properties General Manager Ahmed Al Marri said: “Over the past few years, Union Properties has focused on strengthening its capital position by investing in its core fundamentals and repaying its legacy debt. As we have now successfully completed all these payments, we are well placed to move forward with our new growth strategy that is backed by our positive financial performances. As a result, we are proud to partner with the leading Islamic bank in the country, and this new financing arrangement with DIB represents a fresh start for the company.”

Naveed Ali, Chief of Corporate Banking at Dubai Islamic Bank said: “We have been a critical player, leading and participating in many key deals this year, and our arrangement with Union Properties is another promising addition to our finance book. It is part of our strategy of strengthening our balance sheet by selectively conducting business with major players in the commercial real estate market. Given UP’s strong financial performance this year, the repayment of all previous debt, as well as the growth in the real estate sector, we believe this deal to be another successful step in establishing a sustainable trend in the real estate sector.”

The bank has been involved in a number of landmark international and domestic corporate finance deals over the past year, including a US$750 million sukuk tranche for the Dubai Department of Finance. 

Emicool refinances with Dubai Islamic Bank

Emirates District Cooling (Emicool), a cooling service provider, has signed a US$245 million 12-year refinancing facility with Dubai Islamic Bank (DIB), the largest Islamic bank in the UAE.

Source: Emicool website.

Emicool's Chairman Abdulaziz Bin Yagub Al Serkal said the refinancing agreement with DIB would help to expand Emicool’s business and further cement the company’s leadership position as a top-tier district cooling service provider in the region.

"Emicool has mapped up ambitious growth plans and continued expansion of its production capacity. As the demand for district cooling grows across the region, it has become imperative for Emicool to optimise production capacity and further enhance its technological capabilities to meet market requirements efficiently,” he said.

Adib Moubadder, CEO of Emicool, added: “Emicool has proven its capabilities as a leader in the district cooling industry over the years. We provide continuous chilled water cooling services to over 15,000 customers, with the most efficient and highest quality service to support the growth of Dubai’s infrastructure with sustainable development and innovative technologies. This refinancing will help us further expand our operations geographic reach and technological excellence in the UAE, and other parts of the region.”

Dr Adnan Chilwan, CEO of Dubai Islamic Bank, noted that the UAE is witnessing renewed economic momentum with infrastructure development attracting local and international investors. "In our view, primary infrastructure development projects are the cornerstone of sustainable growth, a key element of the strategy of the country. 

"DIB has always played a pivotal role in leading and facilitating such transactions and is linked to many landmark deals with some of the top corporates across the country. Emicool’s business model and their long-term strategic vision, ties in well with DIB’s own growth plans, and further solidifies our position as a bank of choice in this sector,” he said.

Naveed Ali, Chief of Corporate Banking at Dubai Islamic Bank, said: “We are pleased to support Emicool for this refinancing arrangement and partnering with them in their growth ambitions. Over the past year we have been able to leverage our substantial experience in arranging complex financing deals, while maintaining a strong focus on managing risks, to expand our portfolio. Emicool is another important partner in this regard, and we believe that they have the leadership and right strategy in place to carry out their expansion plans.”

Emicool, a joint venture of Dubai Investments and Union Properties, is currently offering district cooling services in locations such as Dubai Investments Park, Dubai Motor City, Dubai Sports City, Uptown Mirdiff and Palazzo Versace and D1 Tower at Al Jaddaf, with an installed capacity of 330,000 tonnes of refrigerant. Emicool expects to expand into Saudi Arabia and Qatar in the future.

Dubai Islamic Bank invests in Indonesia

Dubai Islamic Bank (DIB), the bank which introduced Islamic financing to the world, plans to take an initial 25% stake in Bank Panin Syariah, a listed shari'ah commercial bank offering Islamic banking services in Indonesia, to promote the growth of shari'ah banking in the country, the bank said last 
month. 

Source: DIB website.

Bank Panin Syariah is currently controlled by Bank Panin and operates through a network of 10 branches. The bank successfully completed its IPO in January 2014 to raise IDR475 billion (US$42 million) through the issuance of rights shares. The bank has assets over IDR4.3 trillion (US$375 million) whereas its equity base stood at over IDR998 billion (US$88 million) as of March 31, 2014. 

DIB will jointly manage and operate Bank Panin Syariah with Bank Panin, its controlling shareholder, providing its well-established expertise in Islamic banking operations to Bank Panin Syariah, while Bank Panin contributes its knowledge of the local market.

DIB expects to increase the equity to 40% upon obtaining the relevant regulatory approval, including from the Financial Services Authority (OJK) in Indonesia. 
 
According to DIB, Islamic banking and finance is one of the world’s fastest-growing economic sectors, comprising more than 400 institutions managing assets in excess of US$1 trillion globally.