Moody’s rates Emaar certificates Baa2

Moody's Investors Service said it assigned a definitive Baa2 long-term issuer rating to Emaar Malls Group LLC (EMG).

Concurrently, the agency assigned a provisional Baa2 rating to the proposed issuance of trust certificates by EMG Sukuk Ltd. (EMG Sukuk), a special purpose vehicle of Emaar.

The outlook is stable.

Moody's said it considers the sukuk, which follows the structure of a "Wakala" transaction, to be a senior unsecured obligation.

The agency's assignment of a provisional Baa2 rating to the sukuk is in line with Emaar’s issuer rating and reflects (a) the ultimate obligation of Emaar to ensure that the periodic distribution amount is always maintained; and (b) the existence of a purchase undertaking, which implies that certificate, or sukuk, holders ultimately rely on the creditworthiness of Emaar for repayment when the trust is dissolved.

Certificate holders have no security, lien or pledge over any of the purchased assets. Under the structure, Emaar acts as obligor, servicing agent and seller.

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