Sarwa Capital for consumer and structured financial services has successfully closed its inaugural Sukuk issuance by Sarwa Sukuk, a subsidiary of Sarwa Capital, of EGP 2.5bn. The issuance is a Shariah compliant 7-year Mudarabah Sukuk and received a high credit rating of A- by the Middle East Ratings and Investors Service (MERIS).
The proceeds will be used for further expansion of Contact Credit and its affiliate companies.
This issue is the first transaction of its kind and the largest Sukuk issuance in Egypt.
The landmark issuance underlines the group’s strong financial position and its ability to diversify its funding sources to capture growth opportunities and solidifies its strategic position in developing innovative financing structures in the Egyptian debt capital market.
Sarwa has always been a pioneer in offering innovative financial solutions and the leading private issuer of corporate debt instruments in Egypt with total bond issuances reaching over EGP 23bn to date through 30 issuances.
This transaction comes as a result of a combined effort from reputable banks, financial institutions, and the Financial Regulatory Authority (FRA) which showed strong support during the process.
Sarwa Sukuk was the first to obtain Sukuk license in Egypt by the FRA in July 2019.
The issuance closed with strong demand from a wide range of investors reflecting the strong track record of Sarwa in the debt market. Sarwa Promotion and Underwriting acted as lead manager and arranger on the transaction. Banque Misr and Misr Capital acted as underwriters.
The transaction was co-underwritten by Commercial International Bank and Ahli United Bank. Alieldean Weshahi & Partners (ALC) acted as the legal advisor while Elite Consulting Group acted as the independent financial consultant on the transaction.
Ayman El Sawy, Group Chief Financial Officer at Sarwa, commented, “We are extremely proud to complete the inaugural Sukuk issuance for Sarwa Capital and the largest in the Egyptian capital markets. The success of this landmark transaction marks a new phase in diversifying the group’s funding sources to cater for future growth. The Suku issue is the first of a number of new tools to be launched and comes on the back of our strong track record in the securitization bond market. We hope these will act as a model for alternative funding structures in Egypt.”