Sipchem’s recent Mudaraba Sukuk is notable as an economic success and also for its structure.  The financing represented a great addition to the tool kit available to corporate treasurers in Saudi Arabia.

A Sukuk financing typically requires that:

• An issuer has unencumbered tangible assets available;
• The assets are Shari’ah compliant (i.e not related to alcohol, pork, gambling etc.);
• Direct/indirect ownership of those assets vest with the seller/issuer; and
• The estimated value of the assets is greater than or equal to

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