Trump’s Dubai Partner Talking to Banks About Sukuk Bond, Sources SayBy and
Potential issue to help repay $650m Islamic bond due in 2019
Damac has second-highest non-investment grade rating from S&P
Damac Properties Dubai Co., the developer of a Trump-branded golf course in the emirate, is considering selling Islamic bonds this year to raise cash and help repay existing debt, two people familiar with the plan said.
The company is talking to banks for a possible sukuk sale, said the people, who asked not to be identified because the information isn’t public. Damac has a $650 million Islamic bond maturing in April 2019, according to data compiled by Bloomberg.
“If you look at the market window today, I think it’s a pretty good window” to issue debt, Chief Financial Officer Adil Mohammed Hassan Taqi said in an interview with Bloomberg News this week. “It’s natural for us to look and we’re in dialog with banks as we always are.”
A spokesman for the company wouldn’t comment further.
President Donald Trump’s adult sons Eric and Donald Jr., who now manage his business empire, were guests of honor at the launch of Damac’s new luxury golf course in Dubai in February, the first opening of a Trump-branded property since the U.S. inauguration. Damac has a second resort under development, the Trump World Golf Club Dubai, which is being designed by Tiger Woods.
Damac is rated BB by S&P Global, its second-highest non-investment grade. The company’s 2019 sukuk bond has rallied this year, with the yield falling to 5.10 percent from 6.08 on Dec. 30, data compiled by Bloomberg show.
Damac expects sales of about 7 billion dirhams ($1.9 billion) this year as it delivers 2,800 homes, slightly lower than the 7.2 billion dirhams reported in 2016, Taqi said in the interview on March 7. He said he expects the company’s debt to rise to about $1.3 billion next year, from $1.04 billion now.