$335mln Kuwaiti Dinar corporate sukuk completed for Kipco

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KFH Capital, Kamco Invest and Warba Bank have successfully completed the KD103.1 million ($335 million) sukuk issuance for Kuwait Projects Company (Holding) Kipco, the first Kuwaiti Dinar denominated corporate sukuk.

The sukuk issuance, jointly managed by KFH Capital, Kamco Invest, and Warba Bank, is part of the $2 billion Kipco’s International sukuk Programme. Application has been made for Certificates issued under the Programme to be admitted to trading on the London Stock Exchange's International Securities Market (ISM), a market designated for professional investors.

The sukuk comprises two profit rates certificates, fixed and floating, with a tenure of 6 years. The KD66.05 million fixed rate certificates offer a profit rate of 6.5%, whereas the KD37.05 million floating rate certificates offers a profit rate of 7.00% (3.00% over the CBK Discount Rate), provided that the floating rate shall never exceed 7.50% per annum.

Profit payment

The profit payment on both certificates will be paid semi-annually. KFH Capital and Kamco Invest acted as Global Coordinators on the issuance and Joint Lead Managers along with Warba Bank.

The Chief Executive Officer at KFH Capital, Abdulaziz Al Marzooq, stated: “As the Sole Structuring Agent, we’re proud to lead the first Kuwaiti Dinar denominated corporate sukuk. Our team at KFH Capital collaborated closely with the client to innovate and architect the inaugural Wakala / Murabaha sukuk. The commendable cooperation of the Kipco group was instrumental in the successful completion of this groundbreaking transaction."

Al Marzooq further underscored the significance of this issuance, characterising it as a pivotal moment that marks a new chapter for prospective sukuk issuers in the Kuwaiti marketplace. He said: "This landmark transaction sets the stage and paves the path forward for Kuwait based Corporations to use sukuks as a mean for their funding requirements in Kuwaiti Dinar and other currencies.”

Key achievement

Abdullah M AlSharekh, Managing Director of Markets and Investment Banking at Kamco Invest, said: “This transaction represents another significant achievement that will contribute to the expansion of local and regional debt capital markets. Kipco's solid financial position, forward-looking vision, and successful history of utilising the debt capital markets have played a crucial role in attracting substantial investor interest, further bolstering its prospects for future issuances.”

AlSharekh added: “We value the role our investment banking team is consistently undertaking in key transactions and putting forth their experience and credibility to deliver the best possible outcome.”

Thuwaini Khaled AlThuwaini, Chief Investment Banking Officer at Warba Bank, said: “We confirm Warba Bank’s keenness to participate as a joint lead manager and joint subscription agent for the issuance of sukuk for Kuwait Projects Company. Warba Bank succeeded during the last period in strengthening its role in the field of managing and issuing sukuk to its clients inside and outside Kuwait, by arranging new issuances and supporting the capital market. This has positioned Warba Bank amongst the most active players in the regional sukuk market, which affirms its role and experience in this field."