Abu Dhabi's Modon Signs Dh13.7 Billion Loan, Its Largest Financing to Date

The deal, announced on Friday, combines a Dh4.7 billion five-year term loan with a Dh9 billion revolving credit facility. The revolver runs for an initial three years and can be extended to five, and the package includes an option to add another Dh4 billion. The facilities include both conventional and Islamic tranches, in UAE dirhams and US dollars. The company said lenders bid for more than 1.5 times the amount on offer.

Modon said the money will refinance existing facilities and fund its development projects. It said the refinancing will more than double the average maturity of its debt and strengthen its liquidity. That gives the developer more room to manage a large project pipeline, and the revolving facility lets it draw funds as projects need them rather than borrowing everything upfront.

The lenders are a mix of UAE, regional and international banks: Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Emirates Islamic, Emirates NBD, First Abu Dhabi Bank, Mashreq, HSBC, Citi, J.P. Morgan, National Bank of Kuwait and Standard Chartered. The company said the group included both existing and new banking partners. Rothschild & Co was sole financial adviser.

"This transaction represents a defining milestone for Modon and a clear endorsement of our strategy," Matt Matharu, the group's chief financial officer, said in the company's statement. He said the flexible capital would strengthen Modon's balance sheet and support both its development projects and new opportunities.

Modon works in real estate development, hospitality, asset and investment management, events, catering and tourism. It is also raising money for its work in Egypt. In September, Enterprise reported that the company was seeking a separate syndicated loan of 35 billion Egyptian pounds to fund infrastructure at Wadi Yemm, part of the Ras El Hekma project on Egypt's Mediterranean coast.

The company has not said how much of the revolving facility it plans to draw, or when it might use the option to increase the financing by Dh4 billion.