United Arab Emirates-based energy company Dana Gas said on Sunday it had increased the size of its convertible Islamic bond sale to $1 billion to take advantage of demand. The $125 million increase in the Islamic bond, or sukuk, is the company's second increase since the sale began on October 4. The firm said it was raising money to fund expansion.
The sale is the first benchmark-sized sukuk sale since July, when a global credit squeeze triggered by defaults on US home loans drove up corporate borrowing costs, prompting some firms, including Dana Gas, to postpone borrowing.
Benchmark size is typically considered to be at least $500 million. The sukuk sale is expected to close at the end of the month. Dana Gas has operations in the United Arab Emirates, Egypt and the Kurdish region of Iraq, and has projects in development in North Africa and South Asia.