The Emirates National Securitization Corporation (ENSEC) announced that the International Finance Corporation, the private sector arm of the World Bank Group, is contemplating an investment in the institution. ENSEC has signed an investment mandate with IFC.
As part of the mandate arrangement covering two key focus areas, IFC will be performing due diligence with a view to a possible equity investment and, or, an IFC credit enhancement facility. The proposed project is subject to the approval of IFC’s senior management and board.
If approved, this would be the first-of-its-kind IFC project with an entity from the region. The potential deal assumes great significance because it would create a platform for a Dubai entity to establish a niche in the global debt capital markets.
Also under discussion is a technical assistance agreement with IFC, which would focus on assisting ENSEC in their Corporate Governance policies. Through this mandate, IFC would work with ENSEC on their board practices, shareholder rights, internal control environment and disclosures, aimed at improving long-term transparency.
Mr. Mohamad Sotoudeh, Chief Executive Officer of ENSEC, said: “Our mandate agreement with the IFC is an important step for Dubai as we continue on our integration with the global financial markets. We share a strong commitment to achieve strong financial returns with the IFC and at the same time promote high standards in corporate governance, environmental and social practices and we look forward to working closely with them.”
ENSEC’s objective is to be a world class debt capital market advisory and investment services firm through transparent and well governed management. This mandate with IFC is a step towards achieving that goal.
In his comments on the deal with ENSEC, Mr. Azmat Taufique, Senior Regional Manager and Head of IFC’s Dubai Office, said: “IFC’s work within the GCC will focus, among other things on helping deepen and broaden the UAE’s capital markets, building institutions that will strengthen the region’s financial architecture, and providing technical assistance and funding programs to encourage entrepreneurship and the development of small and medium enterprises”.
