The syndicate comprised of seven banks based in UAE, Jordan and Qatar: Mashreq Bank, Arab Bank, Al Khalij Commercial Bank, Dubai Islamic Bank, and The Commercial Bank/Qatar acting as mandated lead arrangers, Arab Jordan Investment Bank as lead arranger and Bank al-Etihad as arranger. Mashreq Bank acted as the sole book-runner for the transaction.
Through its distribution network of regional partners, Mashreq endeavoured to meet Royal Jordanian Airlines' financing requirements and diversify its funding sources to GCC-based conventional and Islamic banks. The transaction successfully encompassed a hybrid structure with a dual conventional and an Islamic (wakalah) tranche.
Chairman of Royal Jordanian Board of Directors Suleiman Hafez said: “Royal Jordanian Airlines has successfully secured a hybrid structured debt instrument as part of the airline’s on-going strategic capital raising programne, to support its intensive turnaround and growth plans to evolve into one of the leading airlines in the Levant and Middle Eastern region. This syndication reiterates the airline’s access to avail international liquidity, with the same success it has accomplished with Jordan based financial institutions.”
Captain Suleiman Obeidat, President/ CEO of Royal Jordanian, said: “We would like to show our gratitude to Mashreq Bank and other participating banks for the successful closure of this deal, which will support the airline’s well-studied plans to carry out network expansion and fleet modernisation, particularly that RJ will introduce more 787s to its fleet by the end of this year. Today five 787s (have been) operating in the fleet since 2014.”
Salman Gulzar, Head of Corporate Banking at Mashreq Bank Qatar stated: “The successful closure of this transaction by Mashreq Bank in these uncertain times demonstrates the trust and confidence we and our partner banks have in supporting reputable and strong Levant-based corporates in the regional and international debt market. Jordan has always been a strategic market for Mashreq Bank and we remain committed to working alongside our core relationship clients like Royal Jordanian to execute innovative financial solutions aimed at supporting their business plans and creating efficiency in their operations."
Salman Gulzar, Head of Corporate Banking at Mashreq Bank Qatar stated: “The successful closure of this transaction by Mashreq Bank in these uncertain times demonstrates the trust and confidence we and our partner banks have in supporting reputable and strong Levant-based corporates in the regional and international debt market. Jordan has always been a strategic market for Mashreq Bank and we remain committed to working alongside our core relationship clients like Royal Jordanian to execute innovative financial solutions aimed at supporting their business plans and creating efficiency in their operations."
The facility carries a tenor of five years and the proceeds of the facility will be primarily utilised to consolidate and refinance RJ’s existing debt and further support the company’s strategic growth and turnaround plans in the short- and medium-run.