IFFIm issues sukuk to the Islamic Development Bank

IFFIm issues sukuk to the Islamic Development Bank

April 9, 2019

Private transaction raised US$ 50 million for immunisation.

London, 9 April 2019 - The International Finance Facility for Immunisation (IFFIm) today completed a private placement sukuk transaction with the Islamic Development Bank Group (IsDB). The sukuk raised US$ 50 million to accelerate funding for immunisation programmes that save children’s lives in the world’s poorest countries.

The sukuk, a certificate that complies with Islamic financing principles, was issued by IFFIm, with IsDB as the sole investor. The First Abu Dhabi Bank (FAB) acted as placement agent on the transaction.

This marks IFFIm’s third sukuk, furthering IFFIm’s presence in Islamic capital markets and building awareness and support for Gavi programmes among Gulf Cooperation Council investors. Two previous sukuk issuances raised $500 million (December 2014) and $200 million (September 2015).

"The Islamic Development Bank's leadership on this sukuk demonstrates its growing engagement in immunisation programs to reach every child with life-saving vaccines in the world's poorest countries,” said Dr. Seth Berkley, CEO of Gavi. “Gavi is grateful for the IsDB’s involvement in this important innovative financing opportunity, and we look forward to deepening our relationship in the future.” 

“IFFIm is excited to work with IsDB to bring a third sukuk to the Islamic capital markets,” said IFFIm Chair Cyrus Ardalan. “The transaction also highlights the shared development goals of the IsDB, IFFIm and Gavi.”

IFFIm raises funds for Gavi’s immunisation and health strengthening programmes by issuing Vaccine Bonds and sukuks in the international capital markets. IFFIm’s bonds and sukuks are supported by legally binding, long-term grants (approximately US$ 6.547 billion) from 10 sovereign donors. The World Bank Treasury acts as IFFIm’s Treasury Manager.

“By supporting IFFIm’s bonds, investors can make a direct contribution to helping Gavi bring life-saving vaccines to children and young people around the world,” said Jingdong Hua, World Bank Vice President and Treasurer. “The World Bank Treasury remains committed to ensuring the continued success of IFFIm’s presence in the capital markets.”

Since its inception in 2000 to the end of 2017, Gavi has helped to immunise more than 288 million children in 33 Organisation of Islamic Cooperation (OIC) member states. Gavi’s financial support to these countries totals more than US$ 6 billion as of 30 September 2018. This represents 50% of Gavi’s overall disbursements worldwide.

“Gavi’s strong impact on saving lives through immunisation is a perfect fit with the IsDB’s strong priority on public health investments,” said Dr. Bandar Hajjar, IsDB President. “That’s why we are very pleased to support IFFIm’s sukuk and extend our relationship with Gavi.”

“First Abu Dhabi Bank congratulates IFFIm on this, the third Vaccine Sukuk issue, and first in private placement format. FAB is honored to have led all three of these deals and to contribute to the very important work that IFFIm and Gavi Alliance undertake in providing vaccinations to children across the developing world. Since its inception, IFFIm has established itself as an innovator in sustainable finance and we applaud IFFIm on this further achievement of using the Islamic capital markets for social good,” said Andy Cairns, Senior Managing Director, Head of Global Corporate Finance at FAB. 

Transaction summary:

Issuer:

IFFIm Sukuk Company III 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$ 50 million

Status:

Senior, Unsecured Trust Certificates

Sukuk Structure:

Murabaha

Format:

Regulation S

Pricing Date:

April 2nd, 2019

Settlement Date:

April 9th, 2019

Maturity Date:

 April 9th, 2022

Profit Rate:

US$ 3-month LIBOR + 4bps p.a., payable quarterly in arrears

Issue Price:

100.00

Redemption Price:

100.00

Listing:

Not Listed

Sole Lead Arranger:

First Abu Dhabi Bank PJSC

Delegate:

Citicorp Trustee Company Limited

ISIN/Common Code:

XS1968572229


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, and until necessary regulatory clearances are in place in the Kingdom of Saudi Arabia.

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.

Within the United Kingdom and if distribution is: (a) effected by a person who is not an authorised person under the Financial Services and Markets Act 2000 (“FSMA”), this announcement is only being addressed to, or directed at, the following persons: (i) persons who are Investment Professionals as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Financial Promotion Order”); and (ii) persons falling within any of the categories of persons described in Article 49(2) (High net worth companies, unincorporated associations, etc.) of the Financial Promotion Order; and (b) effected by a person who is an authorised person under the FSMA, this announcement is only being addressed to, or directed at, the following persons: (i) persons falling within one of the categories of Investment Professional as defined in Article 14(5) of the Financial Services and Markets Act 2000 (Promotion of Collective Investment Schemes) (Exemptions) Order 2001 (the "Promotion of CISs Order"), (ii) persons falling within any of the categories of person described in Article 22 (High net worth companies, unincorporated associations, etc.) of the Promotion of CISs Order and (iii) any other person to whom it may otherwise lawfully be made in accordance with the Promotion of CISs Order (all such persons together being referred to as "relevant persons"). Any security, investment or investment activity to which this announcement may relate is only available to, and any invitation, offer, or agreement to engage in such investment activity will be engaged in only with, relevant persons. No other person should rely on it or any of its contents. This announcement is not being addressed to or directed at any individuals in the United Kingdom acting otherwise than in the course of their trade, business or profession.

A rating is not a recommendation to buy, sell or hold securities, does not address the likelihood or timing of repayment and may be subject to revision, suspension or withdrawal at any time by the assigning rating organisation. Similar ratings for different types of issuers and securities do not necessarily mean the same thing. The significance of each rating should be analysed independently from any other rating.