Islamic capital markets

We have successfully combined our long-standing expertise in capital markets with our in depth knowledge of Islamic finance to develop a market leading Islamic capital markets practice.

We have structured and worked on a wide range of Shari'a compliant capital markets products including sukuk (in which investors subscribe for certificates representing an undivided interest in an underlying asset), Shari'a compliant securitisations and other Shari'a compliant structured products.  We have a breadth of experience and capabilities across many of our offices, including the United Arab Emirates, Saudi Arabia, London and Hong Kong.  We are therefore able to draw upon our deep understanding of Islamic finance principles, our international capital markets expertise as well as our local law knowledge to develop and tailor an Islamic finance solution that best suits your business needs.

Corporate sukuk

We worked on a number of the largest and most high-profile sukuk issuances and sukuk programmes in the Middle East acting for both issuers and underwriters.  For example, we advised in relation to the US$3.52 billion sukuk issuance by Nakheel Development Limited, the world's largest sukuk issuance to date (listed on NASDAQ Dubai), the US$1.5 billion sukuk issuance by DP World Limited (dual listed on the London Stock Exchange and NASDAQ Dubai), which was the first and largest corporate sukuk offering to be made to U.S. institutional investors pursuant to Rule 144A of the U.S. Securities Act.

We have also led the market in other jurisdictions including the sukuk issuance by Saudi Basic Industries Corporation (SABIC), the first sukuk to have been publicly offered in the Saudi Arabian Domestic Market.  It was also the first sukuk issuance to be admitted to the Official List maintained by the Saudi Capital Markets Authority.

In addition, we have advised a number of sovereign and quasi-sovereign entities including the Government of Pakistan on the issuance of US$600 million sukuk certificates, the first sovereign sukuk issued out of Pakistan as well as the Islamic Development Bank on its USS$400 million sukuk issuance, the first international sukuk issuance by a quasi-sovereign entity.

Some of the other corporate sukuk transactions we have advised on are as follows:

• General Electric sukuk - advising the joint lead managers on the US$500 million sukuk issued by GE Capital Sukuk Ltd. (The assets underlying the sukuk are interests in a portfolio of aircraft and rental payments from the lease of such aircraft). The transaction is the first investment grade sukuk for a US corporate.
• Tourism Development and Investment Company PJSC - advising on the establishment of Tourism Development and Investment Company P.J.S.C.'s US$1.45 billion  Sukuk Trust Certificate Issuance Programme and inaugural issuance.
• Islamic Development Bank sukuk programme - advising The Islamic Development Bank in relation to the 2009 update of its US$1.5 billion sukuk trust certificate issuance programme and the second and third Issuances under that programme.
• Saudi Bin Ladin Group sukuk - advising HSBC Saudi Arabia Limited as lead manager on the issuance of over SAR1 billion sukuk-al-mudaraba maturing 2013. The sukuk certificates are issued by Purple Island Corp., a special purpose vehicle incorporated in the British Virgin Islands affiliated with the Saudi Bin Ladin Group Limited.
• Aldar Properties PJSC -  advising Abu Dhabi Commercial Bank PJSC, Barclays Bank PLC, Credit Suisse Securities (Europe) Limited, Dubai Islamic Bank PJSC, First Gulf Bank PJSC, Lehman Brothers International (Europe), National Bank of Abu Dhabi PJSC and Noor Islamic Bank PJSC as joint lead managers of the issuance of AED3.75 billion sukuk (sukuk-al-ijara).

Equity-linked sukuk

We have also structured some of the most innovative Islamic capital markets transactions, including the issuance of convertible and exchangeable sukuk such as the PCFC convertible sukuk, which was the first sukuk convertible into equity.  This was followed by a number of high profile convertible sukuk transactions in both Dubai and Abu Dhabi.  Our reach and expertise also extends to other parts of the region including Kuwait (the convertible sukuk issuance by International Investment Group) and Malaysia (where we represented the investment holding arm of the Government of Malaysia in its debut exchangeable sukuk and its subsequent exchangeable sukuk issuances.)

Some of the other equity-linked sukuk transactions we have advised on are as follows:

• Aldar Properties PJSC - advising Aldar Properties PJSC on the debut issue of US$2.53 billion convertible sukuk certificates listed on the London Stock Exchange. The deal was notable for being not only the third largest sukuk issue in the Gulf region but also the largest convertible sukuk that can convert into listed shares on an UAE exchange.
• Dana Gas - advising Dana Gas on a US$1 billion sukuk-al-mudaraba, which was a "forward start" convertible sukuk.
• Nakheel Sukuk - advising Nakheel Development Limited on a US$3.52 billion sukuk-al-ijara which was listed on NASDAQ Dubai.  This was the world's largest single sukuk issue.

Securitisation

We have combined our in depth knowledge of Islamic finance principles with our rich experience in asset backed securitisation techniques to structure some of the most complex Shari'a compliant transactions seen to date.  Such structures demonstrate that Islamic principles and the rating requirements necessary for the issuance of highly rated instruments have many parallels and can complement each other structurally.

Our unique capability in this area was most recently demonstrated in the Sun Finance Limited transaction, representing the Shari'a compliant asset backed securitisation of instalment sales receivables from the sale of plots of land by Sorouh Real Estate PJSC on the iconic Shams and Saraya Master Developments in Abu Dhabi.  This securitisation of this brand new asset class is the world's largest Shari'a compliant securitisation to date and the sukuk certificates which were issued also represent the highest rated non-sovereign instruments to be issued in the MENA region.

Apart from demonstrating Clifford Chance's market leading expertise in harmonising securitisation techniques, Shari'a principles and local law knowledge, the transaction also showcased the firm's ability to co-ordinate teams across its global network by involving lawyers in Clifford Chance's Dubai, Abu Dhabi, Hong Kong and London offices.