Dubai Duty Free picks banks for US$1.1 billion loan
Source: BI-ME with Reuters , Author: Posted by Bi-ME staff
Posted: Mon April 9, 2012 1:11 pm

UAE. Airport retailer Dubai Duty Free has mandated banks for a US$1.1 billion multi-tranche loan facility to help fund the expansion of Dubai's international airport, the company said in a statement on Monday.

Citibank along with Dubai Islamic, HSBC and Emirates NBD have been hired to arrange and coordinate the debut international transaction, the company said in an emailed statement.

DDF, which is owned by Investment Corporation of Dubai, said the facility includes Islamic and conventional tranches.

Dubai was looking to raise at least US$500 million by selling debt based on future revenues at DDF, sources told Reuters last month.

"The purpose of the facilities is to optimise DDF's capital structure in order to support the further development at Dubai International Airport DIA.L," DDF said in the statement.

Dubai has been examining ways of raising finances to expand its existing aviation infrastructure, as it goes slow on a US$34 billion new facility designed to become the biggest in the world.

Its existing airport serves over 50 million passengers a year as the emirate attempts to leverage its position at the crossroads of air corridors between continents.

DDF said the syndication was launched on April 5 and banks have been invited to commit in U.S. dollars and UAE dirhams. Presentations would be held in Dubai during the week.

Sales at Dubai Duty Free, which covers a sprawling 18,000 square metres of retail space at Dubai International Airport, rose 15.7% to US$1.46 billion in 2011.

The operator, which sponsors high-profile sports events such as the Dubai tennis championship and is famous for lavish giveaways, has seen business boom on the back of sales of branded perfumes, watches and designer clothes.

Liquor, including some of the world's most expensive brands, also boosts sales as travellers and expatriates stock up in a country that largely restricts alcohol sales outside of hotels and restaurants.

Duty Free is expected to add an additional 8,000 square metres by the end of 2012.

 

MIDDLE EAST BUSINESS COMMENT & ANALYSIS

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INTERNATIONAL. U.S. strategic conception must evolve away from seeing these conflicts as distinct theaters into seeing them as different aspects of the same theater: the Black Sea.
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UAE. The Middle East's top brands have grown by an average of 38%, according to The Brand Finance Middle East 50; This brings the total value of the top 50 above US$50 billion for the first time; Emirates holds the top spot and remains far ahead of the rest.
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