Majid Al Futtaim in talks with banks for revolving loan -sources

January 17, 2017 10:41 am

Mall of the Emirates shopping mall in Dubai. Developed and owned by Majid Al Futtaim Properties, it opened in November 2005. Alamy

Dubai’s Majid Al Futtaim, a holding company which owns and operates shopping centres in the Middle East and North Africa, is in talks with banks to obtain a revolving credit facility likely to be in excess of $1.5 billion, sources familiar with the situation said on Monday.

The company is self-coordinating the loan, meaning it has not appointed a bank to arrange the fund-raising exercise, said the sources. The loan would refinance existing debt.

A spokesman for the company said Majid Al Futtaim had no comment.

The shopping mall operator has a number of revolving credit facilities in place and regularly taps both the local and international bank markets.

The planned revolving credit facility – a type of loan allowing the borrower to withdraw and repay funds as and when needed – is likely to be denominated in both U.S. dollars and United Arab Emirates dirhams, said one of the sources.

Last June, Majid Al Futtaim raised a $500 million revolver with a five-year tenor, arranged by BNP Paribas, Emirates NBD and Standard Chartered Bank.

In 2013, the company raised a five-year revolver of about $1.6 billion for general corporate purposes. That loan involved ten mandated lead arrangers and three additional participating banks. It offered a margin of 200 basis points over the London interbank offered rate, according to Thomson Reuters data.

Majid Al Futtaim was in discussions with banks late last year to finance construction of the Mall of Oman, a $700 million project.

The company has a BBB rating from Fitch and Standard & Poor’s.

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