Introduction to
Debt
SHUAA’s debt platform’s investment focus is centred around providing alternative sources of capital to regional corporates and asset owners.
For borrowers, we seek to provide a quick and more flexible alternative to banks and for investors we provide a collateralised investment with downside protection and stable cash returns.
Since 2011, we have deployed over USD 490 million across various credit transactions, returned USD 209 million in principal, and distributed in excess of USD 82 million in profit payments generating an average realised return of 15.0% Most recently, we launched SHUAA Financing.
Opportunities Fund – a dedicated fund focused on private Islamic financing investments in the GCC to build on our track record.
Investment Strategies
- Existing offering
- Growth area
Project finance / Real Estate Debt / Last mile financing
Venture debt – Pre Series B / Series B companies seeking growth capital after proof of concept
Non-performing loans – target regional tier 1 banks
Acquisition finance / HoldCo Debt / Dividend Recaps
Distressed credit opportunities – defaulting borrowers and asset owners
Structures
- Existing offering
- Growth area
Fixed Income Instruments
Syndicated / Club Loans
Sharia Compliant Financing
Whole Loans
Private Debt
Senior Secured Debt
Lucy
USD 30,000,000
Onyx
USD 20,000,000
Pacific
USD 35,000,000
Private Debt
Mezzanine & Subordinated Debt
Regal
USD 20,000,000
Tigris
USD 25,000,000
Bentley
USD 12,000,000
SHUAA Financing Opportunities Fund
The Fund’s objective is to generate high cash income, whilst preserving capital primarily through investing in direct Shari’ah compliant financings, mezzanine financing and other debt-like instruments.
SHUAA successfully completed the first close of the fund in Sept 2020 with c. USD 70 million of commitments, and targeting a final close of USD 150 million in Q3 2021.
The global private credit market is expected to reach USD 1 trillion by 2021. The growing demand from corporates and developers in the GCC, coupled with limited investment managers and institutions providing alternative capital, provides a unique opportunity for the Fund to have access to substantial deal flow at attractive risk adjusted returns.
Strategies
Asset backed and real estate financing
- Deep industry expertise underpins our real estate financing business which provides capital solutions for performing and distressed real estate companies, both under construction and completed
- We invest across the capital structure (Senior and Mezzanine) and provide flexible solutions which address the Borrower’s requirements
- Other asset backed financing includes providing companies with term loans that use accounts receivable, inventory, machinery, equipment as collateral
Venture Debt
- We provide non-dilutive capital, tailor-made for founders looking to drive growth
- This allows founders to scale up and maintain 100% ownership and control
- Our average tickets are between USD 10 million - USD 25 million for ventures in the GCC
Non-performing loans and distressed opportunities
- We partner with financial institutions in the GCC to acquire or assist with non-performing loan portfolios, focusing on extracting value through our recovery and debt servicing team
- The portfolios consist of a diverse spectrum of loans including SME and other corporate loans, real estate and other asset financing
- Our strategy also supports distressed companies to solve existing capital structure difficulties through offering capital solutions
- Underpinning this strategy is our approach to combine protection against loss
Growth and expansion financing
- We provide medium term capital to institutions and shareholders seeking to grow their businesses
- This solution provides a non-dilutive solution for many growing businesses in the GCC region
- Types of transactions include acquisition financing, leveraged buy-outs and other structured debt solutions
