The five-year Islamic bonds, or sukuk, are priced at 275 basis points over the three-month London Interbank Offered Rate, and have a musharaka structure. In musharaka deals, banks provide funding to entrepreneurs and shares in venture profits.
Merrill Lynch and Saudi Arabia's Al Rajhi Bank are arranging the sale, which closes on Monday, the banker who declined to be identified said.
"The money is for the development of three towers in the Bahrain Financial Harbour project," the banker said, referring to a business park in Bahrain.
Islam bans interest, and sukuk returns are derived from underlying physical assets.
Gulf Holding sells $190m Islamic bonds