23 February 2023
Clifford Chance advises the Government of the Emirate of Sharjah on the first ever GCC-sovereign sustainable bond
International law firm Clifford Chance has advised the Government of the Emirate of Sharjah, acting through the Sharjah Finance Department (the Government), on the first sustainable bond issue by a GCC sovereign.
The Government has issued U.S.$1 billion 6.500% Sustainable Notes due 2032 pursuant to Rule 144A and Regulation S of the U.S. Securities Act, 1933 (as amended), under its Global Medium Term Note Programme.
Under the terms of the issuance, the Government will apply an amount at least equal to the net proceeds of the issue of the Sustainable Notes to finance and/or refinance eligible projects and/or expenditures in accordance with the Government's Sustainable Financing Framework. The Sustainable Financing Framework has been aligned with, among other publications, the guidelines specified in the 2021 edition of the Green Bond Principles published by the International Capital Market Association, the 2021 edition of the ICMA Social Bond Principles and the 2021 edition of the ICMA Sustainability Bond Guidelines.
Commenting on behalf of the Sharjah Finance Department, Tom Koczwara, an Adviser in the Debt Management Office, stated: “This is another important milestone in the Government of Sharjah’s efforts to maintain broad market access. The sustainable bond issuance reflects the importance of net-zero targets and other environmental and social initiatives in the UAE and in Sharjah, and the increasing appetite from investors to understand the positive outcomes achieved with their funds. Clifford Chance has again been a key partner to the Government in this landmark transaction.”
The Clifford Chance team was led by partner and Head of Middle East Capital Markets, Stuart Ure, supported by associates Mohsin Abbasi and Benedetta Tola. London-based partner, John Connolly, supported by associate Kelly Frevele, provided U.S. securities advice.
Stuart Ure commented: "With the growing demand by investors globally for financing linked to environmental, social and governance factors and the hosting of the 28th session of the Conference of the Parties (COP 28) in the United Arab Emirates, we are delighted to have supported the Sharjah Finance Department and the Emirate of Sharjah on the first issuance of sustainable bonds by a GCC sovereign. The success of the transaction is testament to the efforts of the Sharjah Finance Department and the working group involved on the transaction."
The Joint Lead Managers and Bookrunners were Abu Dhabi Commercial Bank PJSC, Citigroup Global Markets Limited, First Abu Dhabi Bank PJSC, GIB Capital, HSBC Bank plc, Intesa Sanpaolo S.p.A., Invest Bank P.S.C. and SMBC Nikko Capital Markets Limited. HSBC Bank plc acted as sole global coordinator and sole ESG structuring agent.
Clifford Chance has a long-standing relationship with the Government of the Emirate of Sharjah, having previously advised the Government under its Islamic Trust Certificate Issuance Programme and, during the COVID pandemic, on the Sharjah Liquidity Support Mechanism, which represented the first rated short-term local currency tradeable instrument in the UAE.