The buyback of Dana Gas’ Nile Delta Sukuk reduced the size of outstanding Sukuk to $397 million from $530 million and has enabled the company to achieve an average price of 92.1 cents.
Sharjah-based Dana Gas bought back $133 million (AED 488 million) of its outstanding Islamic bonds, fulfilling the restructure commitment of its Sukuk.
In a statement, Dana Gas stated that it has now satisfied the commitment to buyback circa $100 million of Sukuk following the consensual restructuring of the Sukuk in 2018 and has also met the threshold amount of outstanding Sukuk which allows the company to continue to pay the Sukuk profit rate at four per cent per annum rather than increase to six per annum.
Dana Gas will save $21 million by buying back the total of $133 million of its Sukuk in the market below par and by future profit rates savings on those bought back Sukuk.
The company’s Board of Directors also seeks to propose to the shareholders the payment of a cash dividend of 5.5 fils per share, a 10 per cent increase compared to the 2018 dividend.
The firm secured an agreement to restructure and refinance the company’s $700 million Sukuk, which had been the subject of a protracted legal dispute since 2017.
The company had cited changes in Islamic finance as the reason for the change in legal status of its outstanding Sukuk and argued it was therefore not obliged to repay the debt.