Flydubai Hires Seven Banks For Debut Sukuk – Sources

Low-cost airline Flydubai has mandated Credit Agricole CIB, Dubai Islamic Bank, Emirates NBD, HSBC, National Bank of Abu Dhabi, Noor Bank and Standard Chartered to arrange a potential debut sukuk issue, according to two sources.

The mandate runs for six months, but leads are hoping to complete the preparations within two months to give the issuer the option of launching the deal this year.

In an environment where rates are expected to rise, the sooner the Emirati firm is able to come to market the better, one of the sources said.

In February, Flydubai CFO Mukesh Sodani said in a conference that the firm would look to raise funds through a bond issue and was considering a sukuk option.

“We have not looked at bonds yet but we feel in 2015 we will explore that option and sukuk will certainly be interesting,” he said at a conference in Dubai, Reuters reported.

The Dubai-based carrier is aiming for a benchmark-sized offer, funds from which would be used for the company’s general operating expenses as well as to fund some of its aircraft deliveries, Sodani said.