Qatar's deal provides fresh capital to Barwa
By Shaheen Pasha |
July 9, 2010, Friday
|
Print Edition
Print Edition
QATAR stepped in yesterday to provide fresh funds for the Gulf Arab region's fifth-biggest developer, in a deal financed by its parent, the real estate arm of the Qatar Investment Authority.
Terms have yet to be determined, but the deal to support a unit of Barwa Real Estate comes after Barwa's 45 percent owner, Qatari Diar Finance, appointed Barclays, HSBC, Qatar National Bank, Standard Chartered and RBS to raise US$3.5 billion of funds via a US dollar-denominated benchmark issue.
Qatari Diar Finance is a unit of Qatari Diar Real Estate Investment, a division of the QIA which also holds 45 percent in Barwa.
The Qatari Diar group is at the center of a legal row involving Britain's Prince Charles over its plans to develop a former army barracks site in central London.
Barwa, like other Gulf Arab developers, has been hit hard by the region-wide real estate slump. Qatar is ensuring its key property firms weather the global crisis by pushing through defensive mergers and using the real estate arm of the sovereign wealth fund to invest in them.
The deal, announced yesterday, will take the form of murabaha financing, said Barwa's chief financial officer, Ahmed Al Ezabi.
In a murabaha deal, an Islamic bank buys an asset from the borrower and later sells it back at a premium ?? thereby avoiding the payment of interest, which is forbidden under sharia law.
In a statement yesterday, Barwa said the refinanced unit, Barwa City Real Estate Co, will enter into sharia financing arrangements with two other Barwa subsidiaries once the financing from Qatari Diar is finalized.
Terms have yet to be determined, but the deal to support a unit of Barwa Real Estate comes after Barwa's 45 percent owner, Qatari Diar Finance, appointed Barclays, HSBC, Qatar National Bank, Standard Chartered and RBS to raise US$3.5 billion of funds via a US dollar-denominated benchmark issue.
Qatari Diar Finance is a unit of Qatari Diar Real Estate Investment, a division of the QIA which also holds 45 percent in Barwa.
The Qatari Diar group is at the center of a legal row involving Britain's Prince Charles over its plans to develop a former army barracks site in central London.
Barwa, like other Gulf Arab developers, has been hit hard by the region-wide real estate slump. Qatar is ensuring its key property firms weather the global crisis by pushing through defensive mergers and using the real estate arm of the sovereign wealth fund to invest in them.
The deal, announced yesterday, will take the form of murabaha financing, said Barwa's chief financial officer, Ahmed Al Ezabi.
In a murabaha deal, an Islamic bank buys an asset from the borrower and later sells it back at a premium ?? thereby avoiding the payment of interest, which is forbidden under sharia law.
In a statement yesterday, Barwa said the refinanced unit, Barwa City Real Estate Co, will enter into sharia financing arrangements with two other Barwa subsidiaries once the financing from Qatari Diar is finalized.
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