Taqa board to approve $1.13bn sukuk issue

Abu Dhabi National Energy Company (Taqa) is expected to approve the issue of $1.13 billion (Dh4.15bn) in convertible Islamic bonds to finance its expansion plans when it convenes a board meeting tomorrow.

The government-controlled company, one of the largest energy investment groups in the region, said it would hold a board meeting to discuss the sukuk issue that was approved by the shareholders at an extraordinary meeting in April

"The meeting will cover the issue of convertible bonds and you will be informed of the decision once the meeting on Thursday is over," Taqa said in a statement sent to Abu Dhabi Securities Exchange.

In April, Taqa said it was considering issuing convertible bonds to finance its ongoing investment drive and increase capital to cope with a surge in activity.

Taqa's board discussed a request from Abu Dhabi Water and Electricity Authority (Adwea) to issue a convertible sukuk at a previous meeting.

"The meeting will cover the issuance by the company of instruments convertible into shares of the company for a total amount of up to Dh4.15bn, and to authorise the board and whom the board authorises to set the conditions under which these instruments will be issued including the issue and conversion prices and the increase of the company's share capital that will follow each conversion according to the set conditions," it said in the statement last month.

Taqa, which is 75 per cent owned by the Abu Dhabi Government, issued nearly $2bn in bonds last year to finance its acquisition drive.

Announcing its financial results for 2007 last month, the firm said its total revenues jumped by 72 per cent to a record Dh8.3bn, while net earnings shot up by 113 per cent to more than Dh1bn. The company has set a target to boost its assets to $60bn and become a key player in the global energy industry.

The numbers

$2bn: Was the value of bonds issued last year to finance acquisitions.

72%: Was the rise in revenues of Taqa last year.

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