DP World raises $1.5bn green Sukuk to support sustainability ambitions9 November 2023
DP World has reaffirmed its commitment to sustainable operations by raising $1.5bn through a green Sukuk (Islamic bond or ‘Sharia-compliant’) bond to support its global decarbonisation efforts. The Sukuk, which was oversubscribed 2.3x due to strong demand from local, regional and international investors, is listed on both Nasdaq Dubai and the London Stock Exchange.
The proceeds from the Sukuk will be earmarked for eligible green projects in line with DP World’s recently published Sustainable Finance Framework. Current projects cut across electrification, renewable energy, clean transportation and energy efficiency.
Priced at a spread of 119.8 basis points (bps) above US treasuries with a 5.5% coupon rate, DP World’s Sukuk is said to have achieved one of the tightest spreads for a BBB+ rated corporate globally.
The strength of demand for the Sukuk was supported by what’s been decribed as “robust” credit ratings – Moody’s (Baa2/Stable) and Fitch (BBB+/Stable) – as well as a strong ESG ratings from Sustainalytics (“Negligible risk”), CDP (A- Leadership) and MSCI (B).
DP World group chairman and CEO Sultan Ahmed bin Sulayem said: “We aspire to lead global trade into a more resilient, efficient, and sustainable future for our customers and their customers. That’s why we are acting with scale and ambition, using our hands-on expertise to reshape trade for the better. The price we achieved for this green Sukuk is phenomenal and represents the confidence investors have in DP World as a company and our commitment to sustainability.”
Yuvraj Narayan, group deputy chief executive and chief financial officer, added: “Our green Sukuk amplifies our commitment to placing sustainability at the heart of everything we do, ensuring that we are able to create real societal and economic change. Through this issuance we are able to further align our sustainability strategy, and decarbonisation efforts with the group’s financing strategy.”
DP World’s current portfolio of green and sustainable assets is spread throughout the globe and runs through various elements of its diverse multi-functional business.
Within clean transportation, the company has included electrified freight transportation and hybrid vessels. It says its electrified equipment “is testament to our mature and strong decarbonisation programme”. The group also boasts a number of green buildings within its portfolio that meet internationally recognised green certification building standards, such as BREEAM and LEED.
The business has already committed to becoming carbon neutral by 2040 and net zero carbon by 2050.