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20 April 2024

Emirates NBD arranges Air Lease Corporation’s US$600 million inaugural sukuk

Published
By WAM

Emirates NBD has successfully priced a five-year US$600 million Sukuk for Air Lease Corporation (ALC), marking the first Sukuk issued by a US corporation. The strong demand for the Sukuk saw orders of over $2.2 billion, allowing ALC to increase the offering to $600 million. The profit rate was tightened by 30 basis points to 5.85%, at a spread of 185 basis points over US treasuries due to the robust order book.

The Sukuk structure adheres to the latest Shari’ah standards, and the offering was anchored by Middle Eastern investors who received 80% of the allocation. The Sukuk was priced flat to its existing conventional curve, attracting high-quality institutional investors outside the US, and diversifying ALC's investor pool.

ALC is one of the world's largest aircraft leasing companies and has raised over $20 billion through the bond market. With a net book value of $24.

Greg Willis, Executive Vice President & Chief Financial Officer of Air Lease Corporation, said, “As the first North American corporate Sukuk offering, we are excited to demonstrate the depth and strength of liquidity in the Middle East market. The transaction is a testament to ALC’s broad access to capital, and we look forward to expanding our funding footprint in this region. The quality and breadth of demand for the transaction exceeded our expectations, and we are thankful to our banking partners, investors and advisors for their support in achieving this outcome.”

Mohammad Al Bastaki, CEO of Emirates NBD Capital, stated, “We are proud to have supported the successful pricing of ALC’s inaugural sukuk, marking the first time a US-based corporation has issued a benchmark sukuk. The robust over-subscription and the participation of high-quality institutional investors from the Middle East will support ALC’s efforts to diversify its investor base and reflects the high demand for Shari’ah-compliant issues outside the region. We expect this milestone issue will incentivise other non-regional issuers to consider sukuk issuances.”