Emirates raises bond size to $1 billion on strong demand 

(MENAFN - Khaleej Times) The Arab world's largest airline, Emirates, on Wednesday upsized its five-year bond to 1 billion in an offering that trimmed the yield spread at 330 basis points, banking sources said.

The Dubai-based carrier initially proposed a 500 million issue at a spread of 350 basis points more than the benchmark mid-swap rate.

The deal was upsized to 1 billion on strong demand. According to banking sources, order books for the bond were in excess of 5 billion, reflecting a huge demand for the issue that could positively impact the bond's performance in secondary trading. The overwhelming response underscores investor confidence in one of the world's fastest growing carriers as well as the improved liquidity in the market, analysts said.

The airline hired Deutsche Bank AG, Emirates NBD PJSC, HSBC Holdings Plc and Morgan Stanley to manage the sale. The airline plans to use the money as a security measure to meet its obligations when the need arises, the carrier's President Tim Clark said on May 29.

"We are still waiting on the final market response, which will dictate whether we go ahead with the bond. A decision on this is likely to be made today," Emirates said early Wednesday.

The airline, the world's largest in terms of international passenger capacity, posted a 51.9 per cent surge in net profit of Dh5.4 billion in fiscal ending March 31. Total profits for Emirates Group, including other subsidiaries, stood at Dh5.9 billion, with revenues at Dh57.4 billion.