Shuaa Capital, a leading financial services company, said yesterday that its new credit rating would make it cheaper to raise funds for planned investments abroad.
Shuaa was yesterday assigned a long-term issuer rating of Baa2, a short-term issuer rating of Prime-3 and a stand-alone financial strength rating ('FSR') of Ba1 by rating agency Moody's Investor Service. The outlook on all ratings is stable.
"If we would make any United Kingdom or United States acquisitions for example, it would help to already have investors on the ground who already know us and would support financing needs," Shuaa spokesman Oliver Schutzmann said.
He ruled out any borrowing plans in the "immediate future", and declined to comment on upcoming foreign investments.
"We want to diversify our shareholder base, that is one of our key targets going forward," he said.
The agency praised Shuaa's capital position, liquidity and its financial performance despite volatile capital markets. "However, the ratings are constrained by concentration risks in both funding and the company's investors franchise, as well as… still evolving risk management and corporate governance architecture," Moody's said in a statement.
Shuaa sold Dh1.5 billion of convertible bonds in November, which mature at the end of October this year. State investment arm Dubai Banking Group is Shuaa's largest shareholder, and will own 32 per cent of Shuaa's capital when the bonds mature.
Iyad Duwaji, Chief Executive Officer of Shuaa Capital, said: "We are very pleased to have been assigned the highest issuer rating of any securities firm in the GCC and Arab world and receiving one of the strongest ratings given to any emerging markets financial services institution worldwide. The ratings recognise our solid and consistent business performance, our strong roots in the GCC as well as our clear strategy and robust financial structure. Going forward, the rating will help us develop further areas of our business as issuers, intermediaries and as investment bankers." (With inputs from Reuters)