MANAMA: Bahrain-based GFH Financial Group (GFH) has agreed to acquire sukuk worth $200 million from Al Rajhi Bank, Saudi Arabia’s second-biggest lender.

A GFH statement yesterday said the Villamar Sukuk Company Limited Sharia-compliant sukuk certificates were issued in 2008 to finance the Villamar project in Bahrain Financial Harbour.

GFH said the acquisition was expected to reflect positively on its financials in the second half of the year “due to preferential pricing obtained”.

Work on the $650m Villamar project first started in 2007 and it was supposed to be finished by 2010. However, it was plagued by delays and construction finally ground to a halt in October 2011.

GFH announced in December 2016 that it had signed a sukuk restructuring agreement with Al Rajhi which would allow it to resume work on the stalled project. Under the deal, GFH was to provide up to $50m in financing for the project to be completed in phases.

The project consists of three towers of 54, 52 and 43 storeys with a mix of hotel and residential space. When complete, it will have a total of 850 residential units and a 450-room five-star hotel.

Commenting on the sukuk buy, GFH chief executive Hisham Alrayes said, “We are pleased to announce this important acquisition of the Villamar sukuk by the group. The acquisition will allow GFH to complete the flagship Villamar project and achieve higher financial returns.”

Mr Alrayes said the company would soon announce a partnership with a recognised hospitality group for the project in a bid to “set new standards for premium living in Bahrain”.

“We plan to reap the fruits from this unique project on its completion, which is expected over the next 12-18 months.”

avinash@gdn.com.bh

© Copyright 2018 www.gdnonline.com

Copyright 2018 Al Hilal Publishing and Marketing Group Provided by SyndiGate Media Inc. (Syndigate.info).

Disclaimer: The content of this article is syndicated or provided to this website from an external third party provider. We are not responsible for, and do not control, such external websites, entities, applications or media publishers. The body of the text is provided on an “as is” and “as available” basis and has not been edited in any way. Neither we nor our affiliates guarantee the accuracy of or endorse the views or opinions expressed in this article. Read our full disclaimer policy here.