BankMuscat fund raises record amount.
The RO105 million Oman Fixed Income Fund (OMFI) is the first-of-its-kind fund in Oman and offers subordinated financing to investee companies.
OMFI has received a total investment commitment of RO105 million from local as well as regional investors, including co-investment. With 7-year maturity, OMFI is a closed-ended fund listed on the third market of Muscat Securities Market. The drawdown and distribution mechanism of the fund is akin to that of a private equity fund. Subordinated financing is a prominent source of funding in the global financing markets.
It helps corporates to considerably reduce the cost of financing and is thus considered an optimal solution in capital structure instead of the traditional debt and equity. Popular among investors, it also provides higher yields than fixed deposits, bonds or similar fixed income products.
The Fund Management Board of OMFI comprises Sulaiman bin Mohamed bin Hamed Al Yahyai (Chairman); Rashad Khamis Al Battashi (Vice-Chariman); Salem bin Mohammed Al Mashaikhi, Hatham Mohammed Al Maskery, Sunder George, Ahmed Al Abri and K. Gopakumar.
Commenting on the occasion, Sulaiman bin Mohamed bin Hamed Al Yahyai, chairman, said: "Congratulations to BankMuscat for raising the largest fund in Oman in this 40th year of Rennaissance. Given the prevailing market conditions, to raise a fund of this size is a commendable achievement.
"This demonstrates the faith of investors in the concept and in Omani corporate sector. Investors are glad to be a part of this initiative to provide a credible funding solution to the growing needs of a prospering Omani corporate sector. Also, this is an important milestone in the development of fixed income market in Oman."
AbdulRazak Ali Issa, CEO of BankMuscat said: "The initiative further attests BankMuscat's commitment to expanding the bouquet of investment choices available to investors and developing fixed income securities marke in Oman. This is the first CMA-approved fund to have a capital call structure."
for drawdown of funds from investors," he added.
which was designed for enhancement of return for the fund's investors. We thank the Capital Market Authority and the Central Bank of Oman for their valuable inputs and support to the fund."
Trowers and Hamlins are the legal advisors to the fund. National Bank of Oman is the administrator and custodian and Deloitte & Touche (ME) the auditors to the fund
Muscat Press and Publishing House SAOC 2009
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