Abu Dhabi Islamic Bank (ADIB) has signed an agreement to provide an $80m Shariah-compliant Ijara facility to Oman Shipping Company SAOC (OSC) for two crude oil carrier tankers as part of the Sultanate firm’s expansion plans.
The deal represents OSC’s first Shariah-based leasing Ijarah, which is Arabic for “to give something on rent” as well as ADIB’s pledge to finance assets in the marine and energy sectors.
The facility will allow OSC to enhance its debt position by reducing overall financing costs and eliminating refinancing risk, all while continuing to diversify its pool of financial partners.
Commenting on the deal, ADIB head of ship finance, Christopher Phillips, said: “Completing this transaction with OSC is a testament to the hard work our team and we are well-positioned to build on our track record in this specialised business in order to assist our clients in 2020 and beyond.”
Meanwhile, OSC chief financial officer and acting chief executive officer, Michael Jorgensen, said: “It was important for us to find a trusted partner for our first Shariah-compliant Ijarah facility. ADIB’s team were able to provide a competitive Ijarah facility which served our needs, allowing us to finance two tankers and further support our expansion plans.”