Assisting in fundraising as well as value engineering will be applied to deliver the most benefit to our customer.
Sukuk (Islamic Bond)
The certificates of equal value representing after closing subscription, receipt of the value of the certificates and putting it to use as planned, common title to shares and rights in tangible assets, usufruct and services, or equity of a given project or equity of a special investment activity (“Sukuk”)
Promotes ethical business conduct
Promotes transparency (eg: on the business & underlying assets), fairness, entrepreneurship and sharing of risks between financiers
and customers.
Promoting good business practice
Prohibits interest (riba), uncertainty (Prohibits activities related to vice,alcohol, pork, weapons,Emphasis on profit and loss sharing
and asset backing principles.
Wider investor base
Both Islamic and conventional institutional investors/ fund managers are able to invest in Sukuk thus resulting in wider investor base.
Theoretically cheaper funding cost
Normally in other developed and regulated sukuk markets (eg: Malaysia) with active secondary market, funding cost is cheaper (compared to conventional bonds) as a result of wider investor base.
Gaining prominence as an alternative means of funding
Massive infrastructure spending and large scale project financing gaining momentum in the GCC. Thus at a time of credit crisis and credit crunch in the international markets, reliance on Sukuk as an alternative means of funding is fast
gaining ground.
Convertible Debenture
A convertible debenture (CD) is a security which can be exchanged or converted into common stock under stipulated terms and conditions.
The dilution effect from using CD will be gradual, compared to when funds were raised by using ordinary shares of PO or PP types.
The debt to equity ratio (D/E) will improve in the long term when lenders exercise their rights to convert debts into ordinary shares.