Beneficial ownership of Dharumavantha Hospital, Maldives’ tallest standing building, is set to be re-transferred for a bond of USD 300 million.
In a now publicized letter to the President’s Office, Minister of Finance Ibrahim Ameer stated that efforts to issue a bond of USD 300 million are underway, with the Islamic Corporation for the Development of Private Sector (ICDC).
Ministry of Finance announced that Dharumavantha Hospital building is not being sold, but rather, the Ministry is proceeding with a re-transfer of the beneficial ownership of the building to a 100 percent government-owned SPV, for the issuance of the USD 300 million bond.
A statement by the Ministry explains that the USD 300 million bond is a budgeted revenue stream to bring in much-needed cash flow for the government to finance the 2021 budget and that it is an Islamic Financing Instrument planned for issue after discussions with notable international experts.
The statement revealed that the bond, which is to be sold through the ICDC, is an asset-based sukuk, which means the issuing government makes a 100 percent government-owned Special Purpose Vessel (SPV) and transfers beneficial ownership of an asset, in this case, Dharumavantha Hospital to the SPV. Then, acting for the sukuk investors, the SPV then leases the asset under an agreement to the issuer; The Ministry of Finance.
And after the sukuk term ends, the Ministry of Finance will repurchase the asset from the SPV. The statement stresses that this is not a sale of the building to any party.
“Ownership of Dharumavantha Hospital does not leave the Finance Ministry at any point of the sukuk, and during any phase of sukuk issuing, the building cannot be mortgaged,” stated the Ministry of Finance.