ABU DHABI - Mubadala Development Co, an Abu Dhabi government investment firm, said Wednesday it has closed a $1 billion multi-tranche financing deal for its Zayed University project, and will continue to seek a broad range of debt financing for its future projects amid a "constrained" lending environment.The project--to design and build a new, 6,000 student university campus--will be Mubadala's fourth financed via public-private partnership deals, and is structured as 83% senior debt, 7% mezzanine, and 10% equity, Mubadala said in a statement.
The financing closed oversubscribed, Mubadala said.
"Mubadala has a strong pipeline of transactions and we will continue to focus on broadening the range of debt instruments used to finance future projects, particularly in light of the more constrained nature of the long-term bank financing market," said Derek Rozycki, Executive Director of Project & Corporate Finance.
The debt tranche is made up of $370 million and 2.5 billion U.A.E. dirham ($680.60 million), with ten-year maturity, from 11 local and international banks, Mubadala said.
It includes senior U.S. dollar and dirham conventional debt, a senior commodity murabaha, and mezzanine facilities, and is the first time a mezzanine tranche is used for an infrastructure project in the Persian Gulf region, according to the statement.
Calyon acted as financial advisor, while ADCB, BIIS, BTMU, Calyon, First Gulf Bank, Natixis, NBAD, RBS, SG and Union National Bank, with Al Hilal Bank providing a Sharia-compliant senior tranche and FGB also providing the mezzanine tranche, the statement said.
Mubadala said it recently appointed financial advisors for Tawam Hospital and Strata Composites, its aerospace parts manufacturing company, and "is already looking toward 2010 and continued success in raising debt for our projects."