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Clifford Chance advises the Government of the Emirate of Sharjah on its milestone issue of U.S.$750 million sustainable bonds

6 March 2024

Clifford Chance advises the Government of the Emirate of Sharjah on its milestone issue of U.S.$750 million sustainable bonds

Global law firm Clifford Chance has advised the Government of the Emirate of Sharjah, acting through the Sharjah Finance Department (the Government), on the issue of its U.S.$750 million sustainable bonds under the Government's Global Medium Term Note Programme.

The Government has issued U.S.$750 million 6.125% Sustainable Notes due 2036 pursuant to Rule 144A and Regulation S of the U.S. Securities Act, 1933 (as amended), under its Global Medium Term Note Programme. The new 12-year bond was issued at a price of 99.089, giving a reoffer yield of 6.234%, and was met with significant demand from local and international investors, reflecting the growing demand for sustainable investment opportunities and the Government's strong reputation. The transaction had an order book of around US$4 billion and price tightening from initial price guidance of 235bps over US Treasuries to final pricing of 195bps over US Treasuries.

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 environmental and social initiatives in Sharjah, and the increasing appetite from investors to understand the positive outcomes achieved with their funds. The market response highlights the Government’s success in responding to investor demand and presenting a clear and credible credit narrative for the Emirate of Sharjah. 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 associate Benedetta Tola. London-based partner, Michael Dakin, supported by Terrence Moloney and Sarah Wetzel, provided U.S. securities advice.

Stuart Ure commented: "With the growing demand by investors globally for financing linked to environmental, social and governance factors, we are delighted to have supported the Sharjah Finance Department and the Emirate of Sharjah on another landmark issuance of sustainable bonds by a GCC sovereign. The success of the transaction is testament to the consistent investor engagement by the Sharjah Finance Department."

The Joint Lead Managers and Bookrunners were Abu Dhabi Commercial Bank PJSC, Bank of Sharjah PJSC, Citigroup Global Markets Limited, Crédit Agricole Corporate and Investment Bank, Emirates NBD Bank PJSC, First Abu Dhabi Bank PJSC, HSBC Bank plc and Standard Chartered Bank. HSBC Bank plc and Emirates NBD Bank PJSC acted as Global Coordinators and HSBC Bank plc acted as 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 the first sustainable issuance by a GCC sovereign just last February 2023, 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.

Consistently ranked Band 1 in legal directories, Clifford Chance was awarded 15 awards at the Bonds, Loans & Sukuk Awards 2023 and 8 awards at the IFLR Middle East Awards 2023. Clifford Chance was named Banking and Finance Law Firm of the Year at The Legal 500 MENA Awards 2024, Islamic Finance News (IFN) Law Firm of The Year and IFN Banking & Finance Law Firm of The Year at the IFN Deal of the Year Awards 2023, International Law Firm of the Year at the IFLR Middle East Awards 2023, International Law Firm of the Year (Middle East) at the Middle East Legal Awards 2023, Middle East International Law Firm of the Year at the Chambers Middle East Awards 2023 and The Legal Middle East and Banking and Finance Law Firm of the Year at the North Africa Awards 2024.