Legal Deals of the Week (Feb 25, 2021)

Ashurst advises ADNOC in real estate investment partnership with Abu Dhabi Pension Fund

Ashurst has advised the Abu Dhabi National Oil Company (“ADNOC”) on its strategic real estate investment partnership with the Abu Dhabi Pension Fund (“ADPF”). The partnership will see ADPF invest in an ADNOC entity that holds lease rights to a diversified portfolio of real estate assets located in the Emirate of Abu Dhabi (the “Portfolio”), which are valued at USD5.5 billion. This transaction follows the UDD2.7 billion investment relating to the same assets in September last year by accounts and entities owned and/or advised by Apollo Global Management Inc. and a group of institutional investors, on which Ashurst also advised ADNOC.

Under the terms of the transaction, ADPF will acquire a 31 per cent shareholding in Abu Dhabi Energy Real Estate Company – Sole Proprietorship LLC (“ADEREC”), the company which holds ADNOC’s 51 per cent stake in Abu Dhabi Property Leasing Holding Company RSC Limited ( “ADPLHC”), for USD900 million. ADPLHC holds long-term leasehold interests in the Portfolio and was created to leverage the rental income streams. Following the completion of the transaction, ADNOC will hold 69 per cent and ADPF 31 per cent of ADEREC, whilst Apollo and its subsidiaries will continue to directly hold 49 per cent of ADPLHC.

ADNOC will continue to maintain full ownership and control over the Portfolio, as well as responsibility for all operations and maintenance.

The Ashurst team was led by partner Stuart James, assisted by senior associate Johnson Lo and associates Rushal Noor and Caitlin McPhee.

Trowers & Hamlins advises Sohar International Bank SAOG on debut Sukuk Al Mudaraba Trust Certificate Issuance Programme

Trowers & Hamlins advised its longstanding client Sohar Islamic, Sohar International Bank SAOG (Sohar International) – one of the leading investment banks in Oman – on its role as the sole dealer and issue manager, on the establishment by Takaful Oman Insurance SAOG’s (Takaful Oman) of its debut Sukuk Al Mudaraba Trust Certificate Issuance Programme (Programme). The first Takaful company in the world to establish a programme of this kind.

Takaful Oman successfully issued the first series of Sukuk certificates (Certificates) under the Programme of OMR 6,000,0000 through Takaful Sukuk SPC, the special purpose company established by Takaful Oman for the Programme.

The net proceeds of the Certificates shall be applied by Takaful Oman to strengthen the quality of its capital and for its general corporate purposes.

The transaction is unique as it represents a first-of-its-kind perpetual Sukuk programme established by a Takaful company. Unfamiliarity with Mudaraba structures in the Oman Sukuk market and the way the deferment of profit payments are structured under the Programme added significant complexity to the transaction. The Certificates were admitted to trading by the Muscat Securities Market on the Bonds and Sukuk Market on 2 February 2021.

Salman Ahmed, partner and head of Islamic finance at Trowers, led the Trowers team along with Kuala Lumpur-based finance partner Elias Moubarak.

The transaction was led out of Muscat by the Trowers team led by partner Salman Ahmed, with support from partners Elias Moubarak (Kuala Lumpur) and Jeremy Ingham (Bahrain). The partners were assisted by senior associate Nicol Ong (Kuala Lumpur), associate Aaron Ohm (Muscat) and trainee lawyers AlShaima AlHinai (Muscat) and Alyaqdhan Al Waily (Muscat).

Stephenson Harwood advises Yellow Door Energy on USD31.2 million financing for solar projects

Stephenson Harwood LLP has advised Yellow Door Energy Limited (Yellow Door Energy) on a USD31.2 million financing deal. The funding will be used for the development, construction and operation of eight solar plants in Jordan.

The transaction involved three companies – The European Bank for Reconstruction and Development (EBRD), the Global Environment Facility (GEF), and DEG, the German development finance institution – which lent Yellow Door Energy a total of USD31.2 million senior secured loans. EBRD and DEG provided a USD10.6 million loan in local currency. This local currency financing was complemented by a loan of USD5 million, provided by GEF, a parallel USD15.6 million senior loan in local currency from DEG, and an equity contribution from Yellow Door Energy. The deal will be supported by donor funding from Spain and the European Union.

Yellow Door Energy is a UAE-based sustainable energy provider, which has more than 110 megawatts of solar assets currently operating, or under construction, in the UAE, Jordan, and Pakistan. The eight solar plant projects, with a total capacity of 48.3 MW, will generate around 81 GWh of renewable energy, while reducing 49,000 tons of carbon dioxide emissions annually.

The Stephenson Harwood team was led by partner Nijoe Joseph, who was supported by associates Kara Conneely and Chinar Zaidi.

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