International Finance Facility for Immunisation issues first Sukuk, raising US$ 500 million

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Funding to support immunisation of children in the poorest countries through Gavi

Dubai, UAE, 27 November 2014 – The International Finance Facility for Immunisation Company (IFFIm) today issued its inaugural Sukuk, raising US$ 500 million for children’s immunisation in the world’s poorest countries through Gavi, the Vaccine Alliance. This landmark transaction is the first socially responsible Sukuk with funds to be utilised for this purpose. This successful transaction marks the largest Sukuk al-Murabaha issuance in the public markets and is also the largest inaugural Sukuk offering from a Supranational.

The 3-year Sukuk – a financial certificate that complies with Islamic law – provides institutional investors with a socially responsible investment that will help protect tens of millions of children against preventable diseases.

The Sukuk was coordinated by Standard Chartered Bank, working with joint lead managers Barwa Bank, CIMB, National Bank of Abu Dhabi (NBAD) and NCB Capital Company (NCB Capital). The issue, maturing on 4 December 2017 has an issue price of 100% and carries a quarterly coupon of +15 basis points over 3-month USD LIBOR.

The Sukuk was oversubscribed, even with its unique structure for Sukuk market participants. IFFIm achieved strong diversification in its investor base with 85% of the order book coming from new and primarily Islamic investors. The regional distribution of investors was 21% based in Asia, 11% in Europe and 68% in the Middle East and Africa. Banks took 74%, and central banks / official institutions took 26%.

"IFFIm is dedicated to issuing socially responsible instruments for investors everywhere to make a real difference in saving children’s lives," said IFFIm Chair René Karsenti. "The funds will be used to protect children near and far – in countries like Yemen and Mali to Afghanistan and Indonesia – from deadly diseases."

IFFIm raises funds in the international capital markets to accelerate the availability of funds for immunisation programmes and health system strengthening by Gavi, the Vaccine Alliance. IFFIm’s financial base consists of legally binding grant payments (approximately US$ 6.3 billion) from its nine sovereign donors. The World Bank is IFFIm’s Treasury Manager.

"We are delighted to bring this landmark Sukuk to the growing Islamic Finance market. The use of proceeds – to help finance the delivery of life-saving vaccines and related health system strengthening support to many of the world’s poorest nations – is well aligned with the core principles of Islamic finance. We are grateful for the strong support from investors who value the diversification benefit of IFFIm as a new highly rated name in the Islamic capital markets and appreciate its purpose," said Madelyn Antoncic, Vice President and Treasurer of the World Bank, IFFIm’s Treasury Manager.

From its inception in 2006 up until today’s announcement, IFFIm had raised about US$ 5 billion equivalent in the capital markets to support Gavi, whose mission is to save children’s lives and protect people’s health by increasing access to immunisation in poor countries.

Joint Lead Manager Quotes:

"This issuance is testament to the growing interest among international issuers to tap the Islamic investment pool and the rising demand by both Islamic and conventional investors to subscribe to high-quality Sukuk. We are honoured to be associated with this transaction as part of our continuous efforts to drive the development of the global Islamic Finance industry and to support the noble cause of the International Finance Facility for Immunisation Company and GAVI in saving children's lives in the world's poorest countries," said Afaq Khan, CEO Islamic Banking, at Standard Chartered Bank.

"In a year of landmark Sukuk issuances, the IFFIm debut Sukuk stands out in terms of the opportunity it gives Sukuk investors to be directly part of an initiative that improves the wellbeing of those in need. Barwa Bank was honoured to be part of the transaction," said Khalid Al-Subeai, Acting CEO at Barwa Bank.

"CIMB strongly believes in Gavi's mission, and IFFIm will continue to have our full support. We are honoured to be appointed as Joint Lead Manager and Joint Bookrunner for this prestigious transaction, which demonstrates our distribution capability and competitive edge in the Asian market. We hope that the success of the IFFIm Sukuk will pave the way for more socially-responsible type Sukuk to be issued in the near term," said Tengku Dato' Zafrul Tengku Abdul Aziz, Acting Group CEO at CIMB Group Holdings Berhad.

"NBAD is honored to be Bookrunner on this innovative offering on behalf of IFFIm. It is noteworthy not only as the first-ever socially responsible Vaccine Sukuk but also in evidencing the significant buy-side appetite from Middle Eastern investors for high-grade international credits," said Andy Cairns, Global Head of Debt Origination and Distribution at NBAD.

"We are honored to have jointly led this important benchmark financing in support of IFFIm and Gavi, the Vaccine Alliance. The strong appetite from investors is a reflection of both the increasing role of Sukuk in providing financing solutions globally, and the support for the vital contributions that Gavi makes to improve the lives of children where the need is greatest," said Sarah Al-Suhaimi, CEO of NCB Capital.

Transaction summary  

Issuer:

IFFIm Sukuk Company Limited

Obligor:

International Finance Facility for Immunisation Company (IFFIm)

Obligor Ratings:

AA+ / Aa1 / AA (Fitch / Moody’s / S&P)

Issue Rating:

Aa1 by Moody’s

Amount:

US$ 500 million

Status:

Senior, Unsecured Trust Certificates

Sukuk Structure:

Murabaha

Format:

Regulation S

Pricing Date:

November 27, 2014

Settlement Date:

December 4, 2014

Maturity Date:

December 4, 2017

Profit Rate:

US$ 3-month LIBOR + 0.15% p.a., payable Quarterly in arrears

Issue Price:

100.00

Listing:

Not listed

Global Coordinator:

Standard Chartered Bank

Joint Lead Managers and Joint Bookrunners:

Barwa Bank, CIMB, NBAD, NCB Capital and Standard Chartered Bank

Co-Lead Managers:

Bank Islam Brunei Darussalam Berhad and Union National Bank PJSC

Delegate:

Citicorp Trustee Company Limited

ISIN:

XS1143356654

Disclaimer: 

This announcement is not an offer of securities for sale, or a solicitation of an offer to buy securities, in the United States or any other jurisdiction where to do so would be unlawful. In particular, the certificates relating to the proposed Sukuk transaction will not be marketed, offered or sold to persons in the Kingdom of Bahrain.

The securities referred to herein will be offered and sold in offshore transactions outside the United States in reliance on Regulation S (“Regulation S”) under the U.S. Securities Act of 1933, as amended (the “Securities Act”). The securities have not been nor will be registered under the Securities Act or any state securities law. These materials may not be distributed within the United States, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

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70%

70% of cervical cancer cases can be prevented with human papillomavirus vaccines. One woman dies from cervical cancer every two minutes - or 275,000 a year - over 85% in the developing world.

WHO

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